The following is taken from Ronda Co.'s internal records of its factory with two production departments. The cost driver for indirect labor and supplies is direct labor costs, and the cost driver for the remaining overhead items is number of hours of machine use. Direct Labor Machine Use
Direct Labor Machine use hours
Department 1 $18,800 2,000
Department 2 13,200 1,200
Totals $32,000 3,200
Factory overhead costs
Rent and utilities $12,200
Indirect labor 5,400
General office expense 4,000
Depreciation-Equipment 3,000
Supplies 2,600
Total factory overhead $27,200
Compute the total amount of overhead cost allocated to Department 1 using activity-based costing.
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