Reference no: EM132950312

Problem 1: Barr Company makes steel and titanium handle bars for bicycles. It requires approximately one hour to make one handle bar of either type. During the most recent accounting period, Barr Company made 7,000 steel bars and 3,000 titanium bars. Setup costs amounted to $42,000. One batch of each type of bar was run each month. If a single company-wide overhead rate based on direct labor hours is used to allocate overhead costs to products, the amount of setup cost assigned to the steel bars will be

Option 1: $42,000
Option 2: $4,200
Option 3: $12,600
Option 4: $29,400