Crump Manufacturing Has Provided the Following Information Regarding Its Activity-Based

Multiple Choice

Crump Manufacturing has provided the following information regarding its activity-based costing system:
.Purchasing department costs are allocated based on purchase orders and the cost allocation rate is $52 per purchase order.
.Assembly department costs are allocated based on the number of machine hours and the cost allocation rate is $27 per machine hour.
.Inspection department costs are allocated based on the number of inspection hours and the allocation rate is $39 per inspection hour.
Each unit produced has a direct materials cost of $70 and a direct labor cost of $65. Crump has an
Order for 500 units which will require 40 purchase orders, 750 machine hours, and 50 inspection hours.
- What is Crump's operating income from the order if the units are sold for $225 each?

A) $22,670
B) $20,720
C) $45,000
D) $88,220