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The controller for Tulsa Medical Supply Company has established the following activity cost pools and cost drivers. Activity Cost Pool Budgeted Overhead Cost Cost Driver

The controller for Tulsa Medical Supply Company has established the following activity cost pools and cost drivers.

Activity Cost Pool Budgeted Overhead Cost Cost Driver Budgeted Level for Cost Driver Pool Rate
Machine setups $ 250,000 Number of setups 125 $ 2,000 per setup
Material handling 75,000 Weight of raw material 37,500 lb. $ 2 per pound
Hazardous waste control 25,000 Weight of hazardous chemicals used 5,000 lb. $ 5 per pound
Quality control 75,000 Number of inspections 1,000 $ 75 per inspection
Other overhead costs 200,000 Machine hours 20,000 $ 10 per machine hour
Total $ 625,000

An order of 1,000 boxes of medical testing agent has the following production requirements.

Machine setups 5
Raw material 10,000 pounds
Hazardous materials 2,000 pounds
Inspections 10
Machine hours 500

Required:

1. :Compute the total overhead that should be assigned to the medical testing agent order (Round intermediate calculations and final answer to 2 decimal places.)

2. What is the overhead cost per box of the testing agent? (Round intermediate calculations and final answer to 2 decimal places.)

3. Suppose Tulsa Medical Supply company were to use single predetermined overhead rate based on machine hours. Compute the rate per hour.(Round intermediate calculations and final answer to 2 decimal places.)

4. Under the approach in requirement (3), how much overhead would be assigned to the medical testing agent order?

A. In total

B. Per box of testing unit. (Round intermediate calculations and final answer to 2 decimal places.)

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