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Hickory Company manufactures two products 1 4 , 0 0 0 units of Product Y and 6 , 0 0 0 units of Product


Hickory Company manufactures two products14,000 units of Product Y and 6,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all $586,500 of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z:


Activity Cost Pool Activity Measure Estimated Overhead Cost Expected Activity

Machining Machine-hours $ 195,000 10,000 MHs

Machine setups Number of setups $ 67,500 150 setups

Product design Number of products $ 79,000 2 products

General factory Direct labor-hours $ 245,000 12,000 DLHs

Activity Measure Product Y Product Z

Machine-hours 6,500 3,500

Number of setups 50 100

Number of products 1 1

Direct labor-hours 7,500 4,500

9. Using the ABC system, how much total manufacturing overhead cost would be assigned to Product Y?


Note: Round all intermediate calculations to 2 decimal places.


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