Rastatter, Inc. is a manufacturer of Fish-tachios, a fish product that "tastes exactly like pistachios, but is made primarily of reconstitutedfish bits." Rastatter, Inc. has two main flavor varieties of the popular snack: BBQ and Salt & Vinegar. Rastatter, Inc. currently uses atraditional costing system and applies manufacturing overhead on the basis of direct labor hours.Due to falling popularity of the product that management believes is due to pricing issues, management is considering moving to anactivity-based costing system. There are three major production activities and appropriate cost drivers: machine set up, general factory,and machine processing. The cost drivers for these three activities are number of set ups, direct labor hours, and machine hours,respectively.The following information relates to Rastatter, Inc.'s operations:BBQ Fish-tacios2,500 unitsProduction volumeDirect materialDirect labor*Machine setupsMachine hours*The direct labor wage rate is $12 per hour$40 per unit$24 per unit100 total2,200 totalBudgeted manufacturing costs by activity are as follows:Machine setup overhead vostsMachine processing overhhead costsGeneral factory overhead costsWhat is the total cost distortion related to each product line?O A. $1,687,500B. $1,489,500O C. $198,000O D. $760,500O E. $562,500$240,000$120,000$1,250,000Salt & Vinegar Fish-tachios5,000 units$60 per unit$36 per unit20 total800 total

Name: Rastatter, Inc. is a manufacturer of Fish-tachios, a fish product tha
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Description: Rastatter, Inc. is a manufacturer of Fish-tachios, a fish product that "tastes exactly like pistachios, but is made primarily of reconstitutedfish bits." Rastatter, Inc. has two main flavor varieties of the popular snack: BBQ and Salt & Vinegar. Ras

BBQ FISH SALT & VINEGAR Production volume 2,500 5,000 Direct…

Answered: $24 100 total 2.200 total $30 20 total…

Business

Accounting

$24 100 total 2.200 total $30 20 total 800 total

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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