Cradle, Corp. allocates indirect costs in the assembly department based on direct machine hours, and allocates indirect costs in the packaging department based on direct labor hours. Overhead in the assembly department is $120,000. It takes 2 hours for the machine to create a basic cradle from raw materials and 4 hours to create the deluxe cradle. Overhead in the packaging department is $15,000 and it takes 0.5 hours to package a cradle. The company produces 800 basic and 200 deluxe cradles each month. What is the total overhead allocated to each deluxe cradle?

Box 1: Select the best answer