Mustafa Enterprises makes a variety of products that it sells to other businesses. The company's activity-based costing system has four activity cost pools for assigning costs to products and customers. Details concerning that ABC system are listed below:Activity Cost PoolActivity MeasureActivity RateSupporting assemblyDirect labor-hours (DLHs)$7.50per DLHProcessing batchesNumber of batches$111.65per batchProcessing ordersNumber of orders$86.00per orderServing customersNumber of customers$2,737.00per customerThe cost of serving customers, $2,737.00 per customer, is the cost of serving a customer for one year. Dahle Corporation buys only one of the company's products. The details of last year's purchases of this product are listed below: Number of units purchased 800unitsNumber of
batches 16batchesNumber of orders 4orderDirect labor-hour requirement 0.40DLHs per unitSelling price$24.25per unitDirect materials cost$7.45per unitDirect labor cost$7.85per unitAccording to the ABC system, the total cost of the activity "Supporting assembly" for this customer this past year was closest to:
A. $6,000.00
B. $3.00
C. $2,400.00
D. $320.00
Answer: C
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