Activity Based Costing Number of bests Activity Cost Pool Labor-related Purchase orders. Product testing. Activity Measure Direct labor-hours Number of orders Expertee Omar dost Expected Activity 2,000 DLHS $28,000 $1350 525 orders $3,500 350 tests Template etching Number of templates $700 General factory. Machis hour $50,000 28 templates 10,000 MHS Required: 1. Compute the activity rate for each of the activity cost pools. 2. The expected activity for the year was distributed among the company's four products as follows: Activity Cost Pool Labor-related (DLHS) Purchase orders (orders) Product testing (tests). Template etching (templates) General factory (MHS). Expected Activity Product A Product B Product C Product D 500 100 700 700 80 105 180 160 200 60 0 90 0 14 10 4 3,400 2,200 1,800 2,600 Using the ABC data, determine the total amount of overhead cost assigned to each product. 3. Assume that prior to implementing ABC, Rusties used a conventional cost system that applied all manufacturing overhead to products based on direct labor-hours. Explain how the conventional overhead cost assignments would differ from the activity-based cost assignments with respect to Product B. EXERCISE 3-11 Contrasting Activity-Based Costing and Conventional Product Costing [LO3-2, LO3-3, LO3-4] Rusties Company recently implemented an activity-based costing system. At the beginning of the y management made the following estimates of cost and activity in the company's five activity cost po Se Pro Ge Tot