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Tandem Company manufactures two products (D and F). The overhead costs ($89,750) have been divided...

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Accounting

Tandem Company manufactures two products (D and F). The overhead costs ($89,750) have been divided into three cost pools that use the following activity drivers:

Product Number of Setups Machine Hours Packing Orders
D 10 500 75
F 10 2,000 175
Cost per pool $11,000 $60,000 $18,750

What is the allocation rate per packing order using activity-based costing?

a.$1,875

b.$18,750

c.$75

d.$250

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