St. James, Inc., currently uses traditional costing procedures, applying $863,200 of overhead to products Beta and Zeta on the basis of direct labor hours. The company is considering a shift to activity-based costing and the creation of individual cost pools that will use direct labor hours (DLH), production setups (SU), and number of parts components (PC) as cost drivers. Data on the cost pools and respective driver volumes follow.

Product	Pool No.1 (Driver: DLH)	Pool No.2 (Driver: SU)	Pool No.3 (Driver: PC)
Beta	1,800	40	2,650
Zeta	3,400	60	790
Pool Cost	$156,000	$260,000	$447,200

rev: 10_29_2012

39.

Required information

The overhead cost allocated to Beta by using traditional costing procedures would be closest to:

$502,800.

some other amount.

$564,400.

$414,800.

$298,800.

40.

Required information

The overhead cost allocated to Zeta by using traditional costing procedures would be closest to:

$502,800.

$564,400.

some other amount.

$414,800.

$298,800.