Cullumber Co. designs and builds factory-made premium wooden stairways for homes. The manufactured stairway components (spindles, risers, hangers, hand rails) permit installation of stairways of varying lengths and widths. All are made of white oak wood. The companys budgeted manufacturing overhead costs for 2022 are as follows:

Overhead Cost Pools		Amount
Purchasing		$69,000
Handling materials		80,000
Production (cutting, milling, finishing)		204,000
Setting up machines		95,000
Inspecting		90,000
Inventory control (raw materials and finished goods)		129,000
Utilities		180,000
Total budget overhead costs		$847,000

For the past four years, Cullumber has been charging overhead to products on the basis of machine hours. For 2022, it has budgeted 100,000 machine hours. Robert Williams, owner-manager of Cullumber, recently directed her accountant, Linda Jones, to implement the activity-based costing system that she has repeatedly proposed. At Roberts request, Linda and the production foreperson identify the following cost drivers and their usage for the previously budgeted overhead cost pools.

Activity Cost Pools		Cost Drivers		Estimated Use of Cost Drivers
Purchasing		Number of orders			600
Handling materials		Number of moves			8,000
Production (cutting, milling, finishing)
		Direct labour hours			102,000
Setting up machines		Number of set-ups			1,250
Inspecting		Number of inspections			6,000
Inventory control (raw materials and finished goods)
		Number of components			172,000
Utilities		Square metres occupied			10,000

William Dion, sales manager, has received an order for 280 stairways from Kennel Builders Inc., a large housing development contractor. At Williams request, Linda prepares cost estimates for producing components for 280 stairways so William can submit a contract price per staircase to Kennel Builders. She accumulates the following data for the production of 280 stairways:

Direct materials		$103,600
Direct labour		112,000
Machine hours		14,500
Direct labour hours		5,000
Number of purchase orders		60
Number of material moves		800
Number of machine set-ups		100
Number of inspections		450
Number of components		16,000
Number of square metres occupied		800

A) Calculate the predetermined overhead rate in $ in machine

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B) What is the manufacturing cost per stairway

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