Gregory Enterprises has identified three cost pools to allocate overhead costs. The following estimates are provided for the coming year:

Cost Pool	Overhead Costs		Cost driver	Activity level
Supervision of direct labor	$320,000		Direct laborminushours	800,000
Machine maintenance	$120,000		Machineminushours	960,000
Facility rent	$200,000		Square feet of area	100,000
Total overhead costs	$640,000

The accounting records show the Mossman Job consumed the following resources:

Cost driver	Actual level
Direct laborminushours	200
Machineminushours	1,600
Square feet of area	50

Which method of allocation probably best estimates actual overhead costs used? Why?

A.Three activitycost drivers because they best reflect the relative consumption of resources.

B.Single direct laborhours cost driver because it is easiest to analyze and interpret.

C.Three activitycost drivers because product costs can be significantly crosssubsidized.

D.Single direct laborhours cost driver because it is best to allocate total costs uniformly to individual jobs.