Adelberg Corporation makes two products: Product A and Product B. Annual production and sales are 1,000 units of Product A and 1,000 units of Product B. The company has traditionally used direct labor-hours as the basis for applying all manufacturing overhead to products. Product A requires 0.4 direct labor-hours per unit and Product B requires 0.2 direct labor-hours per unit. The total estimated overhead for next period is $79,740.

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:

Expected ActivityActivity Cost PoolEstimated Overhead CostsProduct AProduct BTotalActivity 1$38,5201,2006001,800Activity 219,3209005001,400General Factory21,900400200600Total$79,740

(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 activity-based costing system is closest to:

rev: 09_26_2019_QC_CS-182967

Multiple Choice

• $27.04
• $19.30
• $35.20
• $28.00