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What is the total overhead allocated to product a

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Reference no: EM131591444

Question - Miramar Industries manufactures two products: A and B.  The manufacturing operation involves three overhead activities-production setup, material handling, and general factory activities.  Miramar uses activity-based costing to allocate overhead to products.  An activity analysis of the overhead revealed the following estimated costs and activity bases for these activities:

ActivityCostActivity BaseProduction setup$250,000Number of setupsMaterial handling150,000Number of partsGeneral overhead80,000Number of direct labor hours

Each product's total activity in each of the three areas are as follows:

Product AProduct BNumber of setups100300Number of parts40,00020,000Number of direct labor hours8,00012,000

What is the total overhead allocated to Product A using activity-based costing?

a. $162,500

b. $32,000

c. $224,000

d. $194,500

Reference no: EM131591444

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