Bippus Corporation manufactures two products: Product X08R and Product P56L. 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 X08R and P56L.Activity Cost PoolActivity MeasureTotal CostTotal ActivityMachiningMachine-hours$247,00013,000MHsMachine setupsNumber of setups$60,000150setupsProduct designNumber of products$56,0002productsOrder sizeDirect labor-hours$260,00010,000DLHsActivity MeasureProduct X08RProduct P56LMachine-hours10,0003,000Number of setups11040Number of products11Direct labor-hours6,0004,000Using the plantwide overhead rate, how
much manufacturing overhead cost would be allocated to Product P56L?
A. $311,500
B. $249,200
C. $418,000
D. $373,800
Answer: B
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