Horgen Corporation manufactures two products: Product M68B and Product H27T. The company 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 M68B and H27T.Activity Cost PoolActivity MeasureTotal CostTotal ActivityMachiningMachine-hours$299,00013,000MHsMachine setupsNumber of setups$240,000400setupsProduct designNumber of products$80,0002productsGeneral factoryDirect labor-hours 290,00010,000DLHsActivity MeasureProduct M68BProduct H27TMachine-hours6,0007,000Number of setups250150Number of products11Direct labor-hours4,0006,000Using the ABC system, how much total manufacturing overhead cost would be assigned to Product
H27T?
A. $465,000
B. $454,500
C. $291,000
D. $174,000
Answer: A
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