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How much overhead would be assigned to the Downy product

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Question - Crane manufactures mattresses for the hotel industry. It has two products, Downy and Firm and total overhead of $490000. The company plans to manufacture 240 Downy mattresses and 340 Firm mattresses this year. In manufacturing the mattresses, the company must perform 750 material moves for the Downy and 250 for the Firm; it processes 110 purchase orders for the Downy and 90 for the Firm; and the company's employees work 3100 direct labour hours on the Downy product and 3900 on the Firm. Crane's total material handling costs are $296000 and its total purchasing costs are $194000. Using ABC, how much overhead would be assigned to the Downy product?

a. $490000

b. $328700

c. $245000

d. $161300

Reference no: EM132801736

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