1. (ch 7) FogeIty Company makes two products, titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor Hours Annual Production (units) 10,000 _ 40,000 Additional information about the company follows: ' Hubs require $32 in direct material per unit, and Sprockets require $18. ' The direct labor wage create is $15 per hour. ' Hubs are more complex to manufacture than Sprockets and they require special processing. ' The ABC system has the following activity cost pools. Activity Cost Pool Estimated Overhead Activity (and Activity Cost Measure) I- Machine setups $72,000 100 300 (number of setups) Special Processing $200,000 5,000 _ 5,000 General Factory $816,000 8,000 16,000 24, 000 (Direct Labor Hours) a. Compute the activity for each cost pool. (0) Estimated (1)) (a) + (b) Overhead Expected Activity Activity Cost Pool Cost Activity Rate Machine setups ................ $72,000 400 setups $180 per setup Special processing ........... $200,000 5,000 MHs $40 per MH General factory ................ $816,000 24,000 DLHs $34 per DLH