General Media manufactures cassettes and CDs in separate divisions utilizing one plant location. The following data have been prepared for review.

Fixed operation costs

$900,000

Practical capacity

2,500 hours

Budgeted usage:

Cassette Division

2,000 hours

CD Division

350 hours

Budgeted variable cost per hour

$400 per hour

What is the fixed cost per year and the variable cost per hour, respectively, for the General Media Cassette Division using the dual-rate method, assuming that the allocation bases are capacity for fixed costs and budgeted capacity for variable costs?

Question 2 options:

$765,958 rounded and $360

$720,000 and $360

$720,000 and $400

$765,958 rounded and $400