Doede Corporation uses activity-based costing to compute product margins. In the first stage, the activity-based costing system allocates two overhead accounts--equipment depreciation and supervisory expense-to three activity cost pools--Machining, Order Filling, and Other--based on resource consumption. Data to perform these allocations appear below: 10 Overhead costs: Equipment depreciation Supervisory expense $88,000 $12,700 Distribution of Resource Consumption Across Activity Cost Pools: Equipment depreciation Supervisory expense Activity Cost Pools Machining Order Filling 0.50 0.30 0.50 0.20 Other 0.20 0.30 In the second stage, Machining costs are assigned to products using machine-hours (MHs) and Order Filling costs are assigned to products using the number of orders. The costs in the Other activity cost pool are not assigned to products. Activity: Product W1 Product MO MHS (Machining) 5,540 15,800 21,340 Orders (Order Filling) 142 924 1,066 Total Finally, sales and direct cost data are combined with Machining and Order Filling costs to determine product margins. Sales and Direct Cost Data: Sales (total) Direct materials (total) Direct labor (total) Product W1 $73,000 $37,900 $ 16,300 Product MO $63,800 $19,600 $35, 100 What is the product margin for Product W1 under activity-based costing? (Round your intermediate calculations to 2 decimal places.) Multiple Choice $7,570 $1,870 $6,430 $2,650