Pachero, Inc

Multiple Choice

Pachero, Inc., manufactures and sells two products: Product T1 and Product U6. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below: The direct labor rate is $15.90 per DLH. The direct materials cost per unit is $259.80 for Product T1 and $188.80 for Product U6. The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: The activity rate for the Production Orders activity cost pool under activity-based costing is closest to:

A) $77.24 per order
B) $138.89 per order
C) $93.87 per order
D) $126.64 per order