Question
Torello Corporation manufactures two products: Product H95V and Product V93N. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing
Torello Corporation manufactures two products: Product H95V and Product V93N. 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 of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products H95V and V93N.
| Activity Cost Pool | Activity Measure | Total Cost | Total Activity | ||
| Machining | Machine-hours | $ | 242,000 | 11,000 | MHs |
| Machine setups | Number of setups | $ | 140,000 | 350 | setups |
| Product design | Number of products | $ | 70,000 | 2 | products |
| Order size | Direct labor-hours | $ | 270,000 | 10,000 | DLHs |
| Activity Measure | Product H95V | Product V93N |
| Machine-hours | 6,000 | 5,000 |
| Number of setups | 250 | 100 |
| Number of products | 1 | 1 |
| Direct labor-hours | 6,000 | 4,000 |
Using the plantwide overhead rate, how much manufacturing overhead cost would be allocated to Product V93N?
rev: 03_17_2018_QC_CS-119201
Multiple Choice
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$429,000
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$433,200
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$288,800
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$361,000
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