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XYZ Ltd. uses activity-based costing (ABC) to allocate overhead costs. The company identified three cost pools: machine-related costs, setup costs, and inspection costs. If the
XYZ Ltd. uses activity-based costing (ABC) to allocate overhead costs. The company identified three cost pools: machine-related costs, setup costs, and inspection costs. If the total overhead costs for the year were $300,000, and the activity drivers and rates were as follows: 18,000 machine hours at $12 per hour, 400 setups at $800 per setup, and 1,500 inspections at $150 per inspection, calculate the overhead cost allocated to a product requiring 1,800 machine hours, 15 setups, and 100 inspections.
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