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Bevo, Inc. uses an activity based costing system. The company has the following overhead costs: Overhead...

Bevo, Inc. uses an activity based costing system. The company has the following overhead costs: Overhead Cost Amount Factory Supplies $300,000 Maintenance Costs $400,000 Indirect Salaries $200,000 After a thorough review of the activities that drive these costs, management of Bevo, Inc. has determined the percentage of these costs that are used by each activity. These are included in the table below: Setups Cost Pool Production Cost Pool Factory Supplies 20% 80% Maintenance Costs 65% 35% Indirect Salaries 80% 20% Using activity based costing, how much cost should be assigned to the Setups cost pool? A. $420,000 B. $900,000 C. $260,000 D. $480,000

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