Addy Company has two products: A and B. The annual production and sales of Product A is 2,400 units and of Product B is 1,800 units. The company has traditionally used direct labor-hours as the basis for applying all manufacturing overhead to products. Product A requires 0.5 direct labor-hours per unit and Product B requires 0.8 direct labor-hours per unit. The total estimated overhead for next period is $106,575. The company is considering switching to an activity-based costing system for the purpose of computing unit product costs for external reports. The new activity-based costing system would have three overhead activity cost pools--Activity 1, Activity 2, and General Factory--with estimated overhead costs and expected activity as follows:

Total	Estimated Overhead Costs		Expected Activity
			Product A	Product B	Total
Activity 1	$32,932		1,700	1,300	3,000
Activity 2	18,757		2,400	900	3,300
General Factory	54,886		1,200	1,440	2,640
Total	$106,575

(Note: The General Factory activity cost pool's costs are allocated on the basis of direct labor-hours.)

The overhead cost per unit of Product B under the traditional costing system is closest to:

rev: 10_10_2012

	$32.30
	$21.32
	$10.98
	$14.77