Nature Company produces two types of products (Cream and Lotion) The Company has a manufacturing overhead of $3,000,000, $200,000 are associated with setup cost. During the year the company expects to execute 500 setups, they are quite similar for each product, although the size of the product run varies from one product to other. The Company uses 12000 machine hours Assume the Company manufactures one lot of Lotion of 1000 units and produces 60 units per machine hour. Another activity that must be considered is material handling. The cost of this activity is not correlated with machine hours, but is related with the weight of the material used for the product. The company determine that $300,000 of its manufacturing overhead cost is associated with handling and must assign this expenditure based on the products weight. The Company expects to carry 4,000,000 pounds of material. Using ABC Method assign cost to the following: 1 2 Lotion weights 1.7 pounds and is produced by 1000 units lots, 60 lots per hour. The other Manufacturing Overhead is based in machine hours only