5.

Zela Company is preparing its annual profit plan. As part of its analysis of the profitability of individual products, the controller estimates the amount of overhead that should be allocated to the individual product lines from the information provided below.

	Wall Mirrors	Speciality Windows
Units produced	130	110
Material moves per product line	14	24
Direct labor hours per product line	1,820	2,640

Budgeted material handling costs: $446,000

Under a traditional costing system that allocates overhead on the basis of direct labor hours, the materials handling costs allocated to one unit of wall mirrors would be:

A) $3,800.

B) $25,480.

C) $23,474.

D) $1,400.

9.

A company has identified the following overhead costs and cost drivers for the coming year:

			Budgeted
Overhead Item	Cost Driver	Budgeted Cost	Activity Level
Machine setup	Number of setups	$ 5,000	100
Inspection	Number of inspections	75,000	5,000
Material handling	Number of material moves	50,000	5,000
Engineering	Engineering hours	10,000	500

Budgeted direct labor cost was $70,000 and budgeted direct material cost was $194,000. The following information was collected on three jobs that were completed during the year:

	Job 101		Job 102		Job 103
Direct materials	$ 2,000		$ 7,000		$ 3,000
Direct labor	$ 1,000		$ 1,000		$ 2,000
Units completed	50		25		150
Number of setups	1		2		2
Number of inspections	10		5		15
Number of material moves	15		5		40
Engineering hours	5		25		8

If the company uses activity-based costing (ABC), how much overhead cost should be assigned to Job 103?

A) $450.

B) $2,000.

C) $885.

D) $1,770.