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Billy Corp allocated the following amounts of manufacturing overhead to Products A & B using only direct labor hours as a driver: Product A 168,000
Billy Corp allocated the following amounts of manufacturing overhead to Products A & B using only direct labor hours as a driver: Product A 168,000 Product B 112,000 Billy has decided to switch to ABC for the allocation of manufacturing overhead. Billy will still use direct labor hours as a driver for $120,000 of overhead. The remaining overhead will be allocated using machine hours. Product A uses 2,000 machine hours and Product B uses 6,000 machine hours. a) How much additional overhead is allocated to Product B after switching to ABC? b) Refer to above. How much overhead is allocated to Product A in the machine hours pool
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