Tidwell Industries Has the Following Overhead Costs and Cost Drivers

question 64

Multiple Choice

Tidwell Industries has the following overhead costs and cost drivers. Direct labor hours are estimated at 100,000 for the year. $\begin{array}{llrl}\text { Activity Cost Pool}&\text { Cost Driver }&\text {Est. Overhead}&\text { Cost Driver Activity }\\\hline\text { Ordering and Receiving } & \text { Orders } & \$ 120,000 & 500 \text { orders } \\\text { Machine Setup } & \text { Setups } & 297,000 & 450 \text { setups } \\\text { Machining } & \text { Machine hours } & 1,500,000 & 125,000 \mathrm{MH} \\\text { Assembly } & \text { Parts } & 1,200,000 & 1,000,000 \text { parts } \\\text { Inspection } & \text { Inspections } & 300,000 & 500 \text { inspections }\end{array}$ If overhead is applied using activity-based costing, the overhead application rate for ordering and receiving is

• A) $1.20 per direct labor hour.
• B) $240 per order.
• C) $0.12 per part.
• D) $6,834 per order.

---

Definitions:

Joseph Galloway

A loyalist politician, lawyer, and writer in the American Colonies, who served as a delegate to the First Continental Congress but later maintained his loyalty to the British crown during the American Revolution.

John Adams

The second President of the United States, known for his role in the American Revolution and as a Founding Father.

George Washington

The first President of the United States, serving from 1789 to 1797, and a key leader during the American Revolutionary War.

Continental Army

The army raised by the Second Continental Congress in 1775 to fight the British during the American Revolutionary War, commanded by General George Washington.