St. Vincents, Inc., currently uses traditional costing procedures, applying $853,800 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.

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

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

Multiple Choice

• $290,655.
• $406,655.
• $494,655.
• $563,145.
• None of the answers is correct.

Product Beta Zeta Pool No.1 (Driver: DLH) 1,600 3,100 Pool No. 2 (Driver: SU) 50 55 Pool No. 3 (Driver: PC) 2,550 830 Pool Cost $188,000 $294,000 $371,800