Final answer:
To calculate the manufacturing overhead allocated to each customer, divide total manufacturing overhead by total machine-hours to get the overhead rate, then multiply by the machine-hours used per product.
Step-by-step explanation:
To compute the manufacturing overhead allocated to each customer using a simple costing system that uses machine-hours as the allocation base, you need to know the total overhead costs and the total number of machine-hours utilized. Firstly, calculate the overhead rate per machine-hour by dividing the total manufacturing overhead by the total machine-hours. Then, multiply the number of machine-hours used for a customer's product by this overhead rate to find the overhead allocated to that product. Using the provided information, with $200 for manufacturing cost and assuming 50 hours of labor with one machine, the total cost can be found. The hourly wage and the scenario where it might not matter to the firm's technology choice, although a preference for machines over labor, are also given.