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In its first year of operations a company produced and sold 70,000 units of Product A at a selling price of $20 par unit and
In its first year of operations a company produced and sold 70,000 units of Product A at a selling price of $20 par unit and 17,500 units of Product Bata selling price of $40 per unit. Additional information relating to the company's only two products is shown below. Product Product B Total Direct materials $436,300 $251,700 $ 688,000 Direct labor $200,000 $104,000 304,000 Manufacturing overhead 608,000 Cost of goods sold $1,600,000 The company created an activity-based cooling system that allocated its manufacturing owerhead coats to four activities as follows: Activity Activity cost. Poal (and Activity MRR AUPR) Machining (machine-hours Setups (setup hoara) Product design i number of products Other (organization-sustaining costs Total nanufacturing overhead cast Manufacturing avarhead $213,500 157,500 120,000 117,000 $60,000 Product Product B Total 90,000 62,500 152,500 75 300 375 1 1 2 NA NA The company's ABC implementation team also concluded that $50.000 and $100,000 of the company's advertising expenses could be cirectly traced to Product A and Product B, respectively. The remainder of its selling and administrative expenses $400,000) was organization-sustaining in nature. The company's activity-based costing system would allocata how much manufacturing overhand to Product B? Wutile Chokee 3252,500 $265. aa $2, $273.600
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