Peace Company Makes Metal Signs for Businesses and Residences The Amount of Support Costs Assigned to a Small Sign

Peace Company makes metal signs for businesses and residences. These signs are made of sheet metal, which the owner paints by hand. The owner has a good sense of his labor and materials cost behavior, but he is concerned that he does not have good measure of other support costs. Currently, he predicts support costs to be 40% of the cost of materials. Close investigation of the business reveals that $10 per direct labor hour is a more plausible and reliable support cost relationship. Consider estimated support costs of the following two signs that Peace Company makes. $\begin{array}{lll}&\text { Small Sign }&\text { Large Sign }\\\text { Labor cost (p er hour) } & \$ 200 & \$ 500 \\\text { Direct labor hours } & 5 & 9 \\\text { Number of components } & 8 & 10\end{array}$ The amount of support costs assigned to a small sign using number of components as the cost driver is:

A) $90
B) $50
C) $200
D) $80