5-6A. Activity pool Activity rate per unit Repair and manintenance on assembly machine $2 ($104,000/52,000) Programming cost 48 (168,000/3,500) per programming hour Software inspection 48 (12,000/250) per inspection Product testing 6.4 (16,000/2,500) per test Decoder P Decoder Q Repair and manintenance on assembly $32,000 machine (16,000*$2) $72,000 (36,000*$2) Programming cost 96,000 (2,000*48) 72,000 (1,500*48) Software inspection 9,120 (190*48) 2,880 (60*48) Product testing 7,040 (1,100*6.4) 8,960 (1,400*6.4) Total overhead cost allocated $146,080 $153,920 LO 5-1, 5-3 Exercise 5-7A Comparing an ABC system with a traditional costing system Use the information in Exercise 5-6A to complete the following requirements. Assume that before shifting to activity-based costing, Snowden Industries allocated all overhead costs based on direct labor hours. Direct labor data pertaining to the two decoders follow. Direct Labor Hours Decoder P 8,000 Decoder Q 16,000 Total 24,000 Required a. Compute the amount of overhead cost allocated to each type of decoder when using direct labor hours as the allocation base. Page 229 b. Determine the cost per unit for overhead when using direct labor hours as the allocation base and when using ABC. Round your figures to two decimal points. c. Explain why the per-unit overhead cost is lower for the high-volume product when using ABC