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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:

	I63E			E76I
Direct materials per unit	$	19.40		$	58.20
Direct labor per unit	$	17.90		$	53.70
Direct labor-hours per unit		0.90			2.70
Annual production (units)		90,000			30,000

The company's estimated total manufacturing overhead for the year is $4,467,600 and the company's estimated total direct labor-hours for the year is 162,000.

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 Measures	Estimated Overhead Cost
Assembling products (DLHs)	$	3,240,000
Preparing batches (batches)		223,200
Product support (product variations)		1,004,400
Total	$	4,467,600

	Expected Activity
	I63E	E76I	Total
DLHs	81,000	81,000	162,000
Batches	1,200	650	1,850
Product variations	2,400	1,300	3,700

The manufacturing overhead that would be applied to a unit of product I63E under the company's traditional costing system is closest to:

Multiple Choice

• $27.58

• $74.46

• $49.64

• $24.82

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