Snavely, Inc., manufactures and sells two products: Product E1 and Product A7. Data concerning the...
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Accounting
Snavely, Inc., manufactures and sells two products: Product E1 and Product A7. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below:
Expected Production
Direct Labor-Hours Per Unit
Total Direct Labor-Hours
Product E1
800
5.0
4,000
Product A7
300
2.0
600
Total direct labor-hours
4,600
The direct labor rate is $18.40 per DLH. The direct materials cost per unit for each product is given below:
Direct Materials
Cost per Unit
Product E1
$127.10
Product A7
$299.80
The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
Estimated
Expected Activity
Activity Cost Pools
Activity Measures
Overhead Cost
Product E1
Product A7
Total
Labor-related
DLHs
$
100,096
4,000
600
4,600
Machine setups
setups
47,208
300
400
700
Order size
MHs
738,368
4,100
4,200
8,300
$
885,672
The total overhead applied to Product A7 under activity-based costing is closest to: (Round your intermediate calculations to 2 decimal places.)
A) $373,632
B) $115,524
C) $241,548
D) $413,664
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