Pro Tool Company Expects to Produce 24,000 Total Units During

question 15

Multiple Choice

Pro Tool Company expects to produce 24,000 total units during the current period. The costs and cost drivers associated with four activity cost pools are given below: Production of 1,000 units of an auto towing tool required 800 labor hours, 12 setups, and consumed 30% of the product sustaining activities. How much total overhead cost will be allocated to this product if the company allocates overhead on the basis of a single overhead allocation rate based on direct labor hours?
$\begin{array}{|c|c|c|c|c|}\hline \text { ACTIVITIES: } & \text { UNIT } & \text { BATCH } & \text { PRODUCT } & \text { FACILITY } \\\hline & \overline{\text { LEVEL }} & \overline{\text { LEVEL }} & \text { LEVEL } & \text { LEVEL } \\\hline \text { Cost } & \$ 50,000 & \$20,000 & \$ 10,000 & \$ 120,000 \\\hline\\\hline \text { river } & 4,000 \text { labor hrs } & 100 \text { set ups } & \% \text { of use } & 24,000 \\\hline\end{array}$

• A)$18,400
• B)$10,000
• C)$100,000
• D)$40,000

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Definitions:

Postponement

The act of delaying or deferring an action or event to a later time.

Emotional Elements

Components of emotions that are essential for understanding feelings, which include physiological responses, expressive behaviors, and subjective experiences.

Strategy

A plan of action designed to achieve a long-term or overall aim.

Dominate

To have control, power, or authority over something or someone.