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Lojay Company produces custom covers for the air conditioning units of homes and businesses. For its overhead costs the company uses an activity-based costing system.

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Lojay Company produces custom covers for the air conditioning units of homes and businesses. For its overhead costs the company uses an activity-based costing system. The following data has been provided by the Lojay company regarding its annual overhead costs and its activity cost pools: Overhead Costs: Production overhead $89,000 Office expenses 41.500 Total $130,500 Distribution of Resource Consumption: Activity Cost Pools Making Covers Job Support Other Total Production overhead 33% 4594 229% 100% Office expenses 149% 549% 32% 100% The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs. The amount of activity for the year is as follows: Activity Cost Pool Annual Activity Making covers 2,500 yards Job support 200 jobs Other Not applicable Required

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