Rivera Company manufactured two products, A and B, during April. For purposes of product costing, an overhead rate of $2.00 per direct-labor hour was used, based on budgeted annual factory overhead of $500,000 and 250,000 budgeted annual direct-labor hours, as follows:

Budgeted Overhead Budgeted Hours
Department 1 $300,000 200,000
Department 2 200,000 50,000
$500,000 250,000

The number of labor hours required to manufacture each of these products was:

Product A Product B
In Department 1 3 1
In Department 2 1 3
Total 4 4

During April, production units for products A and B were 1,000 and 3,000, respectively.

Required:
a. Using a plantwide overhead rate, what are total overhead costs assigned to products A and B, respectively?
b. Using departmental overhead rates, what are total overhead costs assigned to products A and B, respectively?
c. Assume that materials and labor costs per unit of Product B are $10 and that the selling price is established by adding 40% of total costs to cover profit and selling and administrative expenses.What difference in selling price would result from the use of departmental overhead rates?