Smagula Company has two products: A and B. The annual production and sales level of Product A is 18,188 units. The annual production and sales level of Product B is 31,652. The company uses activity-based costing and has prepared the following analysis showing the estimated total cost and expected activity for each of its three activity cost pools. (Note that

the information provided above is the same as that provided for the previous question.)

Activity

Cost Pool

Estimated

Cost

Expected Activity

Product A

Product B

Activity 1

$ 80,000

200

800

Activity 2

360,000

600

5,400

Activity 3

58,400

1,000

500

The following information is also available: Sales price per unit $100.00

Direct material per unit 20.00

Direct labor per unit 10.00

Compute the profit margin for Product B using activity-based costing.