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Cleveland Choppers manufactures two types of motorcycles, a Base and a Loaded model. The following activity and costs have been gathered: Product Number of Components

Cleveland Choppers manufactures two types of motorcycles, a Base and a Loaded model. The following activity and costs have been gathered:

Product Number of Components Number of Setups Number of Direct Labor Hrs
Base 15 20 700
Loaded 25 40 600
Overhead costs $ 27,000 $ 22,500

The number of components and number of setups are chosen as activity-cost drivers for overhead. Assuming an ABC costing system is being used, what is the total overhead cost assigned to the Base model?

Multiple Choice

  • $15,450.

  • $15,625.

  • $13,500.

  • $21,375.

  • $17,625.

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