Moistner, Inc., manufactures and sells two products: Product E6 and Product W9. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below: Expected ProductionDirect Labor-Hours Per UnitTotal Direct Labor-HoursProduct E67007.04,900Product W91005.0500Total direct labor-hours 5,400The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: EstimatedExpected ActivityActivity Cost PoolsActivity MeasuresOverhead CostProduct E6Product W9TotalLabor-relatedDLHs$233,6044,9005005,400Machine setupssetups 30,942500400900Order sizeMHs 712,0454,2004,3008,500 $976,591 If the company allocates all of its
overhead based on direct labor-hours using its traditional costing method, the overhead assigned to each unit of Product E6 would be closest to: (Round your intermediate calculations to 2 decimal places.)
A. $1,265.95 per unit
B. $240.66 per unit
C. $302.82 per unit
D. $586.39 per unit
Answer: A
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