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San Antonio Foundry recently implemented an activity-based costing system. It has determined the following costs pools and co
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Answer #1

Answer:

Correct option is B. $2.54

Explanation:

Step 1:

Per machine setup hour cost = $900000 / 12000 = $75

Per machine operation = $500000 / 10000 = $50

Per inspection cost = $120000 / 4000 = $30

Step 2:

calculation of Total manufacturing overhead:

Setup cost = 7 setup hours x $75 = $525

Machine operation cost = 5 x $50 = $250

Inspection cost = 8 x $30 = $240

Total manufacturing overhead = $525 + $250 + $240 = $1015

Step 3:

Per unit manufacturing overhead cost = $1015 / 400 units = $2.54

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