Torello Corporation manufactures two products: Product H95V and Product V93N. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products H95V and V93N.Activity Cost PoolActivity MeasureTotal CostTotal ActivityMachiningMachine-hours$242,00011,000MHsMachine setupsNumber of setups$140,000350setupsProduct designNumber of products$70,0002productsOrder sizeDirect labor-hours$270,00010,000DLHsActivity MeasureProduct H95VProduct V93NMachine-hours6,0005,000Number of setups250100Number of products11Direct labor-hours6,0004,000Using the plantwide overhead
rate, how much manufacturing overhead cost would be allocated to Product V93N?
A. $429,000
B. $288,800
C. $433,200
D. $361,000
Answer: B
Business
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