Ben Corporation manufactures two products: Product E05G and Product L64Y. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products E05G and L64Y.Activity Cost PoolActivity MeasureTotal CostTotal ActivityMachiningMachine-hours$285,00015,000MHsMachine setupsNumber of setups$180,000300setupsProduct designNumber of products$64,0002productsOrder sizeDirect labor-hours$350,00010,000DLHsActivity MeasureProduct E05GProduct L64YMachine-hours12,0003,000Number of setups170130Number of products11Direct labor-hours3,0007,000Using the plantwide overhead rate, the
percentage of the total overhead cost that is allocated to Product E05G is closest to:
A. 30.00%
B. 27.87%
C. 19.00%
D. 50.00%
Answer: A
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