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Blue Ridge Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plantwide factory overhead rate for allocating overhead to products.

Blue Ridge Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plantwide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. The following table presents information about estimated overhead and direct labor hours.

Overhead Direct Labor Hours (dlh) Product
A B
Painting Dept. $248,000 10,000 dlh 16 dlh 4 dlh
Finishing Dept. 72,000 10,000 4 16
Totals $320,000 20,000 dlh 20 dlh 20 dlh

Using a single plantwide rate, determine the overhead rate per unit for Blue Ridge Marketing Inc.'s Product B.

a.$640.00

b.$496.00

c.$144.00

d.$320.00

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