14. Orear Corporation manufactures two products: Product Z34D and Product J25M. The company uses a...
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14. Orear Corporation manufactures two products: Product Z34D and Product J25M. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Z34D and J25M. Activity Measure Total Cost Total ctivity 150 setups Activity Cost Pool $120,000 6,000 MHs Machining..Machine-hours Machine setups...Number of setups Product design $90,000 $84,000 $300,000 10,000 DLHs Number of products 2 products Product Z34D Product J25M Activity Measure Machine-hours 4,000 90 2,000 60 Number of products... 7,000 3,000 Using the plantwide overhead rate, the percentage of the total overhead cost that is allocated to Product J25M is closest to: 50.00% (B) 30.00% 15.15% D) 19.87%
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