Fox Hunting Gear manufactures two products: camouflage jackets and camouflage hats. The company makes 50,000 jackets and 20,000 hats each year. Information for overhead costs and for the two products appears below.

ActivityDriver

Estimated Total

Overhead Cost

Jackets

Hats

Setups# of setups$200,000

500setups1,500setupsOrdering parts# of parts

300,00060,000parts40,000partsMachining# of machine hours

600,00012,000machine hrs.6,000machine hrs.Inspections# of inspections

400,00010,000inspections40,000inspectionsShipping# of shipments

300,00010,000shipments10,000shipmentsTotal overhead$1,800,000

How much is the overhead cost of each hat if all overhead is assigned using ABC?

$100.00 per hat

$24.00 per hat

$47.00 per hat

$159.33 per hat

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