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

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The controller for Tulsa Medical Supply Company has established the following activity cost pools and cost drivers. Budgeted Overhead Activity Cost Pool Cost Cost Driver Machine setups $375,000 Number of setups Material handling 75,000 Weight of raw material Budgeted Level for Cost Driver 150 25,000 lb. Pool Rate $2,500 per setup $ 3 per pound Hazardous waste control 25,000 Quality control 150,000 Weight of hazardous chemicals used Number of inspections 5,000 lb. $ 5 per pound 2,000 $ 75 per inspection Other overhead costs 250,000 Machine hours 25,000 $ 10 per machine hour Total $875,000 An order for 1,000 boxes of medical-testing agent has the following production requirements. Machine setups Raw material Hazardous materials Inspections Machine hours 7 setups 12,000 pounds 5,000 pounds 10 inspections 500 machine hours Required: 1. Compute the total overhead that should be assigned to the medical-testing agent order. 2. What is the overhead cost per box of testing agent? 3. Suppose Tulsa Medical Supply Company were to use a single predetermined overhead rate based on machine hours. Compute the rate per hour. 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 agent.

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