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Question: bailey company manufactures and sells a number of products including...

Question details
Bailey Company manufactures and sells a number of products, including
Product R. Results from last year from the sale of Product R are given
below:

Sales revenue .............................  $750,000
Variable production costs .................   450,000
Sales commissions .........................   110,000
Salary of product manager .................      ?
Advertising expense .......................    80,000
Allocated general overhead ................      ?
Net operating loss ........................   <55,000>

Bailey Company is considering eliminating the production and sale of
Product R. The company has determined that if Product R is discontinued,
the contribution margin of its other products will increase by $40,000.

Based on a cost analysis, the management of Bailey Company has determined
that if Product R is discontinued the company's net income will decrease
by $25,000.

Calculate the amount of allocated general overhead cost for Product R
incurred last year.
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