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Monrovia Bike Corp manufactures two models of bicycles: the Gully Runner and the Claim Jumper. In the past, Monrovia had been using a traditional overhead

  1. Monrovia Bike Corp manufactures two models of bicycles: the Gully Runner and the Claim Jumper. In the past, Monrovia had been using a traditional overhead allocation system based on machine hours. Monrovia has decided to switch to an activity-based costing system using two activity cost pools. Information related to the new system is as follows:

Activity Estimated OH Cost Estimated Activity

Automated Assembly $189,000 7,000 Mach Hrs

Parts Management $63,000 100 part #s

Actual activity for the year for the two models of bikes were as follows:

Bicycles Produced MH Used Part Numbers

Claim Jumper 300 2,400 70

Gully Runner 960 4,800 30

Under the new activity-based costing system, what amount of overhead cost would Monrovia assign to each Claim Jumper bicycle?

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