1. Quasi-Tech Corporation produces specially machined parts. The parts are produced in batches in one continuous manufacturing process. Each part is custom produced and requires special engineering design activity (based on customer specifications). Once the design is completed, the equipment can be set up for batch production. Once the batch is completed, a sample is taken and inspected to see if the parts are within the tolerances allowed. Thus, the manufacturing process has four activities: engineering, setups, machining, and inspecting. Costs have been assigned to each activity using direct tracing and resource drivers:

   Activity	Expected Cost	Activity Driver	Activity Capacity
   Engineering	$1,000,000	engineering hours	5,000 hours
   Setups	$ 900,000	setups	200 setups
   Machining	$2,000,000	machine hours	25,000 machine hours
   Inspection	$ 800,000	inspection hours	2,500 inspection hours

   Owens produces two models: Model X and Model Y. The following table shows how the two products consume activity.

   	Model C	Model D
   Units completed	300,000	200,000
   Engineering hours	1,000	4,000
   Setups	80	120
   Machine hours	20,000	5,000
   Inspection hours	1,500	1,000

   First determine the overhead costs assigned to model D using the two most expensive activities for cost pools. The costs of the two relatively inexpensive activities are allocated to the two most expensive activities in proportion to their costs. (Round to two decimal places.)The engineering cost assigned to model D would be

   	a.	$1,253,320.
   	b.	$626,650.
   	c.	$1,879,970.
   	d.	$3,133,333.33.