Q22

Russell Manufacturing Corporation has a traditional costing system in which it applies manufacturing overhead to its products using a predetermined overhead rate based on direct labor-hours (DLHS). The company has two products, Slow and Fast, about which it has provided the following data: Direct materials per unit Direct labor per unit Direct labor-hours per unit Annual production Slow $ 14.10 $ 3.20 0.20 50,000 Fast $ 43.40 $ 25.60 1.60 35,000 The company's estimated total manufacturing overhead for the year is $1,926,700 and the company's estimated total direct labor-hours for the year is 66,000. The company is considering using a variation of activity-based costing to determine its unit product costs for external reports. Data for this proposed activity-based costing system appear below: Activities and Activity Measures Assembling products (DLHS) Preparing batches (batches) Product support (product variations) Total Estimated Overhead Cost $ 920,000 462,700 544,000 $1,926,700 Expected Activity Slow Fast Total 10,000 56,000 66,000 1,780 1,810 3,590 DLHS Batches Midterm Exam 1 Saved Help Save & Exit DLHS Batches Product Variations Expected Activity Slow Fast Total 10,000 56,000 66,000 1,780 1,810 3,590 1,170 1,140 2,310 The manufacturing overhead that would be applied to a unit of product Slow under the company's traditional costing system is closest to: Multiple Choice O $10.55. $2.74. O $16.39 O O $5.84