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Racer X Corporation manufactures two models of motorized go-carts, a standard and a deluxe model. The following activity and cost information has been compiled: Number of Number of Number of Product Setups Components Direct Labor HoursStandard 15 10 750Deluxe 35 15 500 Overhead costs $15,000 $25,000
Problem 1: Number of setups and number of components are identified as activity-cost drivers for overhead. Assuming an activity-based costing system is used, what is the total amount of overhead cost assigned to the standard model?
A) $25,500B) $15,000 C) $14,500D) $24,000
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