Tar Heel Company has two products: A and B The annual production and sales of Product A is 500 units and of Product B is 1,000 units. The company has traditionally used direct labor-hours as the basis for applying all manufacturing overhead to products. Product A requires 0.4 direct labor-hours per unit and Product B requires 0.2 direct labor-hours per unit. The total estimated overhead for next period is $68,756 The company is considering switching to an activity-based costing system for the purpose of computing unit product costs for external reports the new activity-based costing system would have three overhead activity cost pools-Activity 1, Activity 2 and Order Size-with estimated overhead costs and expected activity as follows Estimated Expected Activity Overhead Activity Cost Pools Costs Product A Product B Total Activity 1 31,031 1,000 300 1,300 Activity 2 22,249 1,600 300 1,900 Order size 15,476 200 200 400 Total $ 68,756 (Note: The Order Size activity cost pool's costs are allocated on the basis of direct labor hours.) The predetermined overhead rate the activity rate) for Activity 2 under the activity-based costing system is closest to Select one OA $1171 OB. $13.91 OG 574.16 ODS36.19