A company is considering the adoption of an activity based costing system because the managers suspect that their traditional costing system distorts the product costs. The company produces and sells two products, Standard and Deluxe. Their traditional costing system uses machine hours as the allocation base for manufacturing overhead cost. The production managers decided that major activities are Assembly, Machine Setups, and Parts Adminstration and determined the costs for each activity. They also identified how many machine hours, setups, and parts each product requires :

Standard : Price : $120 per unit Deluxe : $150 per unit

Cost : Direct Materials : Standard : $32 per unit Deluxe : $36 per unit

Direct Labor : Standard : $15 per unit Deluxe : $25 per unit

Units Produced : 200,000 units : Standard Deluxe : 100,000 units

Activity :

Assembly (machine hours) : Standard : 100,000 Deluxe : 200,000

Machine setups (setups ) : Standard : 100 Deluxe : 400

Parts administration (part types) : Standard : 200 Deluxe : 200

Overhead (Cost) :

Assembly : $1,200,000

Machine Setups : $900,000

Parts Adminstration : $300,000

Question :

The company is assumed to spend equal money on customer relations among its two customers A and B. Total costs of customer relation for these two customers are $10,000. Customer A placed an order as below. Using the ABC system, the customer margin of product A is (choose closest answer) ?

Standard : 100 units Deluxe : 250 units

A) $44,960

B) $45,100

C) $20,010

D) $20,150

E) $25,010

PLEASE OUTLINE HELP WITH STEPS, ALSO I DON'T KNOW HOW TO CALCULATE TOTAL OVERHEAD FOR TRADITIONAL AND STANDARD RESPECTIVELY, FOR EXAMPLE IN ANOTHER SOLUTION TO PART 1 OF THIS PROBLEM SOMEONE SHOWED THE OVERHEAD FOR STANDARD AS $400,000 and Overhead for Deluxe as $800,000 for assembly under abc system but I don't know how they arrived at this answer.