Note: Quantitative values in the question may differ from those in other similar questions on this quiz and on practice quizzes.

Guess Klein produces designer clothing such as T-shirts and jeans from fabric purchased from several nearby factories. The company's factory has two departments, Cutting and Sewing. The Cutting department, which cuts the garments from patterns, is a machine-intensive operation. It takes three times longer to cut and sew jeans compared to T-shirts. The Sewing department stitches the cut fabric, sews zippers and buttons and does quality checking. While stitching is highly automated, sewing zippers and buttons and performing quality checks is manual.

The company has decided to redo their accounting system and move to an activity based cost system. Table 1 shows the five activity cost pools which include all of the company's direct labor and manufacturing overhead costs. It also shows the cost drivers for each pool. Table 2 shows the cost drivers consumed by the two products. Table 3 shows budgeted product data for Jeans and T-shirts.

Table 1: Guess Klein Activity Cost Pools

Activity

Cost

Cost Driver

Maintain Equipment

$56,000

Machine Hours

Cut

288,000

Number of cuts

Sew

212,000

Number of sides

Button/Zipper

95,500

Labor Hours

Check/Move Goods

45,500

Number of moves

Total

$685,000

Table 2: Guess Klein Activity Cost Drivers

Driver

Jeans

T-shirts

Total

Total Machine Hours

3,500

1,500

5,000

Numbers of cuts per garment

4

1

300,000

Number of sides per garment

4

2

400.000

Total Labor Hours

3,600

0

3,600

Total Number of Moves

5,000

10,000

15,000

Table 3: Budgeted Product Data for Guess Klein Garments

Product

Jeans

T-shirts

Total

Direct Materials

125,000

75,000

200,000

Direct Labor (Allocated on garments produced)

65,000

130,000

195,000

Machine Hours

3,000

1,000

4,000

Garments produced

50,000

100,000

150,000

Using ABC, how much of the Check/Move Goods activity cost would be applied to the T-shirts?

Group of answer choices

$15,167

None of the other three answers is correct

$30,333

$0.15