Softy, Inc. manufactures teddy bears and dolls. Currently, Softy makes 2,000 teddy bears each month. Each teddy bear uses $2.00 in direct materials and $0.50 in direct labor. Softy uses two activities in manufacturing the teddy bears: Sewing and Processing. The total cost associated with Sewing (for both bears and dolls) is $15,000 a month, allocated on the basis of direct labor hours. The total cost associated with Processing is $10,000 a month, allocated on the basis of batches.
What is the total manufacturing cost for one teddy bear?
A. $2.50
B. $4.50
C. $7.00
D. $8.00
Answers: 3
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Softy, Inc. manufactures teddy bears and dolls. Currently, Softy makes 2,000 teddy bears each month....
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