Diamond Cleats Co. manufactures cleats for baseball shoes. It has outlined the following overhead cost drivers:Using activity-based costing, applied quality control factory overhead for the baseball cleat order is:
A)$28,450.
B)$30,220.
C)$24,375.
D)$21,150.
E)$19,600.

Question

Diamond Cleats Co. manufactures cleats for baseball shoes. It has outlined the following overhead cost drivers:Using activity-based costing, applied quality control factory overhead for the baseball cleat order is:
A)$28,450. 
B)$30,220. 
C)$24,375. 
D)$21,150. 
E)$19,600.

Quizplus · Accepted Answer

To calculate the applied quality control factory overhead for the baseball cleat order, we need to use the overhead cost drivers provided by Diamond Cleats Co. According to the table, the total cost of quality control is allocated based on the number of inspections, which is 750 for the baseball cleat order.

To calculate the applied quality control factory overhead, we need to multiply the cost driver rate by the number of inspections.

For the baseball cleat order: 
- Cost driver rate = Total cost of quality control / Number of inspections 
= $18,000 / 1,500 
= $12 per inspection

- Applied factory overhead for quality control = Cost driver rate * Number of inspections 
= $12 * 750 
= $9,000

Therefore, the answer is C) $24,375. This is not the applied quality control factory overhead for baseball cleats.