Question

# Eagle Eye Company produces two types of lenses–L7 and L9. Single Indirect-Cost Pool System ABC System...

Eagle Eye Company produces two types of lenses–L7 and L9.

 Single Indirect-Cost Pool System ABC System Total direct costs \$77,500 \$58,000 Total indirect costs \$37,500 (a) Total costs assigned to L7 \$62,000 \$49,500 Total costs assigned to L9 (b) \$65,500

27) What is the total indirect costs (a) under ABC system?

A) \$53,000

B) \$57,000

C) \$57,500

D) \$40,000

28) What is the total costs assigned to L9 (b) under single indirect-cost pool system?

27. (B) \$57,000

Explanation:

Total Direct Cost + Total Indirect Cost = Total cost assigned to L7 + Total cost assigned to L9

\$58,000 + Total Indirect Cost = \$49,500 + \$65,500

Total Indirect Cost = \$115,000 - \$58,000 i.e. \$57,000

28. \$53,000 (options are not provided in question. So I am providing you with answer only)

Explanation:

Total Direct Cost + Total Indirect Cost = Total cost assigned to L7 + Total cost assigned to L9

\$77,500 + \$37,500 = \$62,000 + Total cost assigned to L9

Total cost assigned to L9 = \$115,000 - \$62,000 i.e. \$53,000

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