Lysiak Corporation uses an activity based costing system toassign overhead costs to products. In the first stage, two overheadcosts--equipment depreciation and supervisory expense-are allocatedto three activity cost pools--Machining, Order Filling, andOther--based on resource consumption. Data to perform theseallocations appear below:

Overhead costs:
Equipment depreciation	$	47,000
Supervisory expense	$	6,000

Distribution of Resource Consumption Across Activity CostPools:

	Activity Cost Pools
	Machining	Order Filling		Other
Equipment depreciation	0.60	0.10		0.30
Supervisory expense	0.60	0.20		0.20

In the second stage, Machining costs are assigned to productsusing machine-hours (MHs) and Order Filling costs are assigned toproducts using the number of orders. The costs in the Otheractivity cost pool are not assigned to products. Activity data forthe company's two products follow:

Activity:

	MHs(Machining)	Orders (OrderFilling)
Product C9	6,900	200
Product U0	3,100	800
Total	10,000	1,000

How much overhead cost is allocated to the Machining activitycost pool under activity-based costing in the first stage ofallocation?

2.

	Activity Cost Pools
	Machining	Order Filling		Other
Equipment depreciation	0.40	0.10		0.50
Supervisory expense	0.20	0.30		0.50

Machining costs are assigned to products using machine-hours(MHs) and Order Filling costs are assigned to products using thenumber of orders. The costs in the Other activity cost pool are notassigned to products. Activity data for the company's two productsfollow:

Activity:

	MHs(Machining)	Orders (OrderFilling)
Product J3	9,100	100
Product F7	900	900
Total	10,000	1,000

Finally, the costs of Machining and Order Filling are combinedwith the following sales and direct cost data to determine productmargins.

Sales and Direct Cost Data:

	Product J3		Product F7
Sales (total)	$	145,200	$	90,700
Direct materials (total)	$	81,400	$	38,600
Direct labor (total)	$	37,700	$	42,400

What is the product margin for Product F7 under activity-basedcosting?