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Orange, Inc. has identified the following cost drivers for its expected overhead costs for the year: Cost Pools Setup Cost Driver Level 900 Budgeted Cost

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Orange, Inc. has identified the following cost drivers for its expected overhead costs for the year: Cost Pools Setup Cost Driver Level 900 Budgeted Cost Cost Driver $180,000 Number of setups Number of 90,000 orders 225,000 Machine hours 45,000 Kilowatt hours Ordering Maintenance Power 4,500 22,500 45,000 Total direct labor hours budgeted = 9,000 hours. The following data applies to Product X, one of the products completed during the year. Direct materials Direct labor Units completed Direct labor hours Number of setups Number of orders Machine hours Kilowatt hours $4,500 $5,400 450 180 18 36 225 450 If the activity based cost drivers are used to allocate overhead cost, the total overhead cost of Product X will be Multiple Choice $6,960. $7,020. $9,000 $10,800. O $8,020

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