Crane Company manufactures two products, Velveeto and Fondant. Crane has estimated overhead costs as follows: setting up machines ($198000), machining ($311880) and inspecting ($111800) Information on the two products follows:
Velveeto and Fondant
Direct labor hours
Velveeto 73000
Fondant 113000
Machine setups
Velveeto 3700
Fondant 2900
Machine hours
Velveeto 109000
Fondant 117000
Inspections
Velveeto 4500
Fondant 4100
If crane uses ABC, how much overhead will be applied to Velveeto?
a. $508750
b. $310750
c. $621680
d. $319920
