Stumbo Company Has Two Production Departments, Cutting and Assembling, Served

Multiple Choice

Stumbo Company has two production departments, Cutting and Assembling, served by one maintenance department. Budgeted fixed costs for the maintenance department for 20X3 were $60,000, and the variable cost per labour hour was $2.00. Other relevant data for 20X3 are as follows:
Actual maintenance department costs for 20X3 were $64,000 fixed and $120,000 variable.
^*in labour hours
-The amount of fixed maintenance costs allocated to the Cutting Department should be

A) $40,000.
B) $24,000.
C) $36,000.
D) $28,000.