Answer the Following Questions Using the Information Below:
Gregory Company

question 35

Multiple Choice

Answer the following questions using the information below:
Gregory Company has identified three cost pools to allocate overhead costs. The following estimates are provided for the coming year:
$$\begin{array} { l r l r } \text { Cost Pool } & \text { Overhead Costs } & \text { Costdriver } & \text { Activity level } \\\text { Supervision of direct labor } & \$ 326,000 & \text { Direct labor-hours } & 900,000 \\\text { Machine maintenance } & \$ 132,000 & \text { Machine-hours } & 960,000 \\\text { Facility rent } & \$ 217,000 & \text { Square feet of area } & 100,000 \\\text { Total overhead costs } & \$ 675,000 & &\end{array}$$ The accounting records show the Mossman Job consumed the following resources:
$$\begin{array}{ll}\text { Cost driver } & \text { Actual level } \\\text { Direct labor-hours } & 200 \\\text { Machine-hours } & 1,500 \\\text { Square feet of area } & 70\end{array}$$
-If direct labor-hours are considered the only overhead cost driver,what is the single cost driver rate for Gregory?

• A) $1.33 per direct labor-hour
• B) $0.80 per direct labor-hour
• C) $0.75 per direct labor-hour
• D) $1.25 per direct labor-hour

---

Definitions:

pH

A scale used to specify the acidity or basicity of an aqueous solution, with lower values being more acidic and higher values more basic.

Sphincters

Circular muscles that control the passage of substances through the openings of the body.

Dentin

A calcified tissue that lies beneath the enamel and cementum of teeth, providing structure and sheltering the pulp.

Enamel

The hard, outermost layer of a tooth that protects it from decay.