Wall, Inc., has identified the following overhead costs and cost drivers:

The following are two of the jobs completed during the year:

The company’s normal activity is 4,000 direct labor hours.

a. If Wall uses direct labor hours to allocate overhead costs, what is the total cost for Job 25?

b. If Wall uses machine hours to allocate overhead costs, what is the total cost of Job 25?

c. If Wall uses ABC drivers to allocate overhead costs, what is the total cost for Job 25 using the provided tables?

d. Compare the results for letters (b) and (c). If Wall uses machine hours to allocate overhead costs, is Job 25 overcosted or undercosted? Explain.

e. Compare the answers for letters (a), (b), and (c). Comment on the implications for decision making from the resulting cost of Job 25 in those answers.

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Activity Setups Ordering Maintenance Power Estimated Cost $10,000 $16,000 $40,000 $25,000 Cost Driver Number of setups Number of orders Number of machine hours Number of kilowatt hours 500 4,000 8,000 50,000