QUESTION 19 Bandit Manufacturing produces three products: Desk Lamps, Floor Lamps and Ceiling Lamps The following information is available for each product. Desk Floor Ceiling Direct material cost per unit $2.00 $8.00 $10.00 Direct labor cost per hour $15.00 $16.75 $18.00 Bandit Manufacturing presently applies overhead using a predetermined rate based on direct labor hours. Estimated Direct Labor hours for the year are 132,026 The product leader for Floor has suggested that Bandit Manufacturing switch to activity-based costing and identified the following activities, cost drivers, estimated costs, and estimated cost driver units for the year: Recommended Estimated Estimated Cost Cost DriverCost Activity DriverUnits Ordering Cost Purchase Orders $33,912 1256 Purchase Machine Operations Machine Hours $1,425,000 12500 Hours $125,400 110 Test Environmentalcompliance I mpliance Test Total OH Cost $1,584,312 Actual January Production Floor Ceiling 7,200 5,800 4,100 4,250 DR442 Desk Number of UnitsProduced Direct Labor Hours Machine Hours 5,875 3,150 375 Actual January Production Floor Ceiling ,200 5,800 4,100 4,250 206 442 Desk Number of UnitsProduced Direct Labor Hours 5,875 3,150 375 2 14 Machine Hours Compliance Test Purchase Orders 19 15 How much OH is allocated to Ceiling Lamps when direct labor hours is used as the volume based cost driver a $185,500 b. $76,500 / C. $56,493 d. $51,000