Chris has a custom curtain and chair cover shop. The job-costing system was designed using an activity-based approach. There are two direct-cost categories (direct materials and direct labor) and three indirect cost pools. These three cost pools represent three activity areas of work at the shop.

Activity Area	Cost Driver Used for Allocation	Cost-Allocation Rate
Materials handling	Number of pieces in the pattern	$2.00 per piece
Stitching	Number of pieces in the pattern	$25.00 per piece
Assambly/Installation	Direct labor hours	$15.00 per hour

In October Chris made and installed five sets of curtains and chair covers for clients. A set includes curtains for two windows and coverings for three chairs. The direct labor rate is $20.00 per hour. Cost data for curtains and covers follows:

	Units Produced	Direct Material Cost	Number of Pieces	Direct Labor Hours
Curtains	10	$2,000	1	20
Chair covering	15	$3,375	6	90

1). The cost for a set of curtains and chair coverings would be (Show the calculations)

a. $5,375.

b. $2,385.

c. $2,085.

d. $1,253.

2). The indirect costs for the shop in October were (Show the calculations)

a. $11,925.

b. $5,375.

c. $4,900.

d. $4,350.