Windsor Co Using ABC, How Much Overhead Is Assigned to Product X

Windsor Co. incurs $1,050,000 of overhead costs each year in its three main departments, machining ($600,000) , inspections ($300,000) and packing ($150,000) . The machining department works 4,000 hours per year, there are 600 inspections per year, and the packing department packs 1,000 orders per year. Information about Windsor's two products is as follows: $$\begin{array} { l c c } & \text { Product X } & \text { Product Y } \\\text { Machining hours } & 1,000 & 3,000 \\\text { Inspections } & 100 & 500 \\\text { Orders packed } & 350 & 650 \\\text { Direct labor hours } & 1,700 & 1,800\end{array}$$ Using ABC, how much overhead is assigned to Product X this year?

A) $252,500
B) $363,462
C) $510,000
D) $525,000

Correct Answer:

Verified

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