Feauto Manufacturing Corporation has a traditional costing system in which it applies manufacturing overhead to its products using a predetermined overhead rate based on direct labor-hours (DLHs). The company has two products, I63E and E76I, about which it has provided the following data: I63EE76IDirect materials per unit$19.90 $54.40 Direct labor per unit$12.00 $31.50 Direct labor-hours per unit 0.80 2.10 Annual production (units) 30,000 10,000 The company's estimated total manufacturing overhead for the year is $2,063,250 and the company's estimated total direct labor-hours for the year is 45,000.The company is considering using a form of activity-based costing to determine its unit product costs for external reports. Data for this proposed activity-based costing system
appear below: Activities and Activity MeasuresEstimatedOverhead CostAssembling products (DLHs)$720,000 Preparing batches (batches) 263,250 Product support (product variations) 1,080,000 Total$2,063,250 Expected Activity I63EE76ITotalDLHs24,00021,00045,000Batches1,0806751,755Product variations2,1151,4853,600 The manufacturing overhead that would be applied to a unit of product E76I under the activity-based costing system is closest to:
A. $184.57
B. $10.13
C. $96.29
D. $88.28
Answer: D
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