Figure 4-16 Newman Company Recently Installed an Activity-Based Relational Database

Multiple Choice

Figure 4-16 Newman Company recently installed an activity-based relational database.Using the information contained in the activity relational table, the following pool rates were computed:
$400 per purchase order
$24 per machine hour, Process 1
$30 per machine hour, Process 2
$80 per engineering hour
Two products are produced by Special Products: X and Y.The plant has two manufacturing processes, Process 1 and Process 2.Other processes include engineering, product handling, and procurement.Product X goes through Process 1 while Product Y goes through Process 2.The product relational table for Special Products is as follows:

- Refer to Figure 4-16.How much machine overhead cost will be assigned to Product X using Process 1?

A) $2,400,000
B) $4,800,000
C) $1,920,000
D) $240,000