Manton Corporation uses an activity based costing system to assign overhead costs to products. In the first stage, two overhead costsequipment expense and indirect laborare allocated to the three activity cost poolsProcessing, Supervising, and Otherbased on resource consumption. Data to perform these allocations appear below:

Overhead costs:Equipment expense$42,500Indirect labor$7,500

Distribution of Resource Consumption Across Activity Cost Pools:Activity Cost PoolsProcessingSupervisingOtherEquipment expense0.600.200.20Indirect labor0.100.300.60

In the second stage, Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow:

Activity:MHs (Processing)Batches (Supervising)Product Z54,3501,200Product C810,650800Total15,0002,000

The activity rate for the Processing activity cost pool under activity-based costing is closest to:

Noreen 4e Rechecks 2017-24-03

$1.70 per MH

$3.70 per MH

$.59 per MH

$1.75 per MH