Calculate the cost that is assigned to the car and truck product lines using an activity-based costing system, given the following information: Estimated Use of Cost Drivers per Product Car Truck Number of set-ups 190 810 Direct labour hours 20,700 15,300 Number of inspections 60 564 Car Overhead assigned $ Truck Revenues Shady Lady sells window coverings to both commercial and residential customers. The following information relates to its budgeted operations for the current year: Commercial $300,000 Residential $480,000 Direct material costs $30,000 $70,000 Direct labour costs 100,000 300,000 Overhead costs 55,000 185,000 162,000 532,000 Operating income (loss) $115,000 $(52,000) The controller, Susan Chan, is concerned about the residential product line. She cannot understand why this line is not more profitable given that window coverings are less complex to install for residential customers. In addition, the residential client base resides close to the company office, so travel costs are not as expensive on a per-client visit for residential customers. As a result, she has decided to take a closer look at the overhead costs assigned to the two product lines to determine whether a more accurate product costing model can be developed. Following are the three activity cost pools and related information she developed: Activity Cost Pools Scheduling and travel Estimated Overhead $ 90.160 Cost Drivers Hours of travel given that window coverings are less complex to install for residential customers. In addition, the residential client base resides close to the company office, so travel costs are not as expensive on a per-client visit for residential customers. As a result, she has decided to take a closer look at the overhead costs assigned to the two product lines to determine whether a more accurate product costing model can be developed. Following are the three activity cost pools and related information she developed: Activity Cost Pools Scheduling and travel Estimated Overhead Cost Drivers $90,160 Hours of travel Set-up time 76,880 Number of set-ups Supervision 49.960 Direct labour cost Estimated Use of Cost Drivers per Product Commercial Residential Scheduling and travel 940 670 Set-up time 380 240 Your answer is correct. Calculate the activity-based overhead rates for each of the three cost pools, and determine the overhead cost assigned to each product line. (Round overhead rate for supervision to 2 decimal places, e.g. 15.25%.) Overhead rates Scheduling and travel $ 56 per travel hour Set-up time Supervision to Total overhead costs applied $ eTextbook and Media 124 per set-up 12.49 % of direct labour cost Commercial 112250 $ Residential 104750 * Your answer is incorrect. Calculate the operating income for each product line using the activity-based overhead rates. (Enter negative amounts using a negative sign preceding the number e.g. -45. Round answers to 0 decimal places, e.g. 1,525.) Operating income (loss) Commercial 298200 Residential 841800