19.Banc Corp. Trust is considering either a bankwide overhead rate or department overhead rates to allocate $396,000 of indirect costs. The bankwide rate could be based on either direct labor hours (DLH) or the number of loans processed. The departmental rates would be based on direct labor hours for Consumer Loans and a dual rate based on direct labor hours and the number of loans processed for Commercial Loans. The following information was gathered for the upcoming period:

Department	DLH		Loans Processed		Direct Costs
Consumer	14,000		700		$	280,000
Commercial	8,000		300		$	180,000

Banc Corp. Trust estimates that it costs $500 to analyze and close a commercial loan. This amount has been included in the $396,000 of indirect costs. How much of the $396,000 indirect costs should be allocated to the Consumer Department?

a.) $246,000.

b.) $280,000.

c.) $172,200.

d.) $116,000.

20. Allure Company manufactures and distributes two products, M and XY. Overhead costs are currently allocated using the number of units produced as the allocation base. The controller has recommended changing to an activity-based costing (ABC) system. She has collected the following information:

Activity	Cost Driver	Amount			M		XY
Production setups	Number of setups	$	82,000		8		12
Material handling	Number of parts		48,000		56		24
Packaging costs	Number of units		130,000		80,000		50,000
		$	260,000

What is the total overhead allocated to Product XY using the current system?

a.) $113,600.

b.) $100,000.

c.) $146,400.

d.) $160,000.

21. The Mega Construction Company recently switched to activity-based costing (ABC) from the department allocation method. The department method allocated overhead costs at a rate of $60 per machine hour. The cost accountant for the Finishing Department has gathered the following data:

Activity	Cost Drivers	Amount
Material handling	Tons of material handled	$	80
Machine setups	Number of production runs		3,750
Utilities	Machine hours		25
Quality control	Number of inspections	$	500

During April, Mega purchased and used $100,000 of direct materials at $20 per ton. There were eight (8) production runs using a total of 12,000 machine hours in April. The manager of the Finishing Department needed 12 inspections. Actual overhead costs totaled $820,000 for the month.

How much overhead costs were applied to the Work-in-Process Inventory during April using activity-based costing?

a.) $536,000.

b.) $720,000.

c.) $736,000.

d.) $820,000.