Activity - Based Costing (ABC) 305 Problem 8-5: Computation of Selling Price using Traditional Costing and ABC Systems. CPA Manufacturing Company identified the following overhead costs and cost drivers for the coming year: Activity Center Cost Driver Budgeted Machine setup Budgeted Cost Activity Level Inspection No. of setups Material handling No. of inspections P20,000 200 No. of material moves 130,000 6,500 Engineering Engineering hours 80,000 8,000 50,000 1,000 The following information was gathered on three jobs that were expected to be completed in the coming year: Job 1001 Job 2002 Job 3003 Direct materials Direct labor P5,000 P12,000 P8,000 P2,000 Units completed P 2,000 P4,000 100 50 Number of setups 200 8 10 14 Number of inspections 22 15 30 Number of material moves 30 40 50 Engineering hours 25 50 15 For the past several years, the company assigned overhead costs to products based on direct labor costs. For the coming year, the budgeted direct labor cost was P100,000 and budgeted direct material cost was P280,000. The company operates in a competitive market and sets product selling prices at cost plus 50% mark-up. Required: 1. Using the current allocation system, determine the total overhead cost of Job 1001; total full cost per unit of Job 2002; and sales price 2. per unit of Job 3003. If the appropriate cost drivers are used in assigning manufacturing overhead, compute the total overhead cost of Job 1001; total full cost per unit of Job 2002; and the sales price per unit of Job 3003