Y Company estimated that its total overhead cost of R600 000. It is considering implementing activity-based costing. Three cost pools (and activity measures) have been identified: machine-related (machine-hours), production orders (number of orders), and product testing (number of tests). The estimated overhead was assigned to the pools as follows: R200 000 to machine-related, R100 000 to production orders, and R300,000 to product testing. Y Company produces two products. The following information is available:

	Product 1	Product 2
Machine-hours	40 000	10 000
Orders	800	200
Tests	6 000	9 000
Direct labour hours	25 000	15 000

The company currently uses traditional costing and allocates overhead based on direct labour hours.

Calculate how much of the overheads are assigned to Product 1 using ABC costing?

	a.	R300 000
	b.	R360 000
	c.	R173 000
	d.	R420 000