Foxx Company Incurs $480,000 Overhead Costs Each Year in Its

Foxx Company incurs $480,000 overhead costs each year in its three main departments, setup ($30,000) , machining ($330,000) , and packing ($120,000) . The setup department performs 40 setups per year, the machining department works 5,000 hours per year, and the packing department packs 500 orders per year. Information about Foxx's two products is as follows: $$\begin{array} { l c c } & \text { Product A1 } & \text { Product B1 } \\\text { Number of setups } & 20 & 20 \\\text { Machining hours } & 1,000 & 4,000 \\\text { Orders packed } & 150 & 350 \\\text { Number of products manufactured } & 600 & 400\end{array}$$ Using ABC, how much overhead is assigned to Product A1 each year?

A) $240,000
B) $363,000
C) $ 96,000
D) $117,000

Correct Answer:

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