Immen Corporation manufactures two products: Product B82O and Product P99Y. 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 B82O and P99Y.Activity Cost PoolActivity MeasureTotal CostTotal ActivityMachiningMachine-hours$330,00015,000MHsMachine setupsNumber of setups$300,000500setupsProduct designNumber of products$46,0002productsOrder sizeDirect labor-hours$330,00010,000DLHsActivity MeasureProduct B82OProduct P99YMachine-hours7,0008,000Number of setups200300Number of products11Direct labor-hours3,0007,000Using the ABC system, how much total
manufacturing overhead cost would be assigned to Product B82O?
A. $297,000
B. $503,000
C. $99,000
D. $396,000
Answer: D
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