14) ABC is particularly useful when overhead costs are an insignificant portion of total costs. 15) Activity-based management focuses on reducing costs and improving processes. MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 16) Activity-based costing A) accumulates overhead in one cost pool, then assigns the overhead to products and services by means of a cost driver B) allocates overhead to activity cost pools, and it then assigns the activity cost pools to products and services by means of cost drivers. C) allocates overhead directly to products and services based on activity levels. D) assigns activity cost pools to products and services, then allocates overhead back to the activity cost pools 17) An "Ordering and Receiving Materials" cost pool would most likely have as a cost driver: A) number of inspection tests. B) number of setups. C) number of purchase orders. D) machine hours. 18) Reynoso Corporation manufactures titanium and aluminum tennis racquets, Reynoso's total overhead costs consist of assembly costs and inspection costs. The following information is available: Cost Titanium Aluminum Total Cost Assembly 500 mach. hours 500 mach. hours $60,000 Inspections 350 $100,000 2,100 labor hours 1,900 labor hours Reynoso is considering switching from one overhead rate based on labor hours to activity-based costing. Total overhead costs assigned to titanium racquets, using a single overhead rate, are A) $100,000. B) $80,000. C) $84,000. D) $112.000. 150 19) Hartley Company produces two products, Flower and Planter. Flower is a high-volume item totaling 20,000 units annually. Planter is a low-volume item totaling only 6,000 units per year. Flower requires one hour of direct labor for completion, while each unit of Planter requires 2 hours. Therefore, total annual direct labor hours are 32,000 (20,000 - 12,000). Expected annual manufacturing overhead costs are $960,000. Hartley uses a traditional costing system and assigns overhead based on direct labor hours. Each unit of Planter would be assigned overhead of A) $60.00. B) $30.00. C) $36.91. D) need more information to compute