CENT Lid produces a range of products. Manufacturing is undertaken using one of two processes the Upha and the Omega Processes. All of the products are manufactured in batches. The current pricing policy has been to absorb all overheads using direct labour hours to obtain total cost. A recent detailed nalysis has examined overhead cast, the results are: Analysis of overhead costs Cost per month (0) Monthly volume Alpha Process cost 192,000 950 hours Omega Process cost 89,600 2,560 hours Set-up cost 85.800 520 set-ups Handling charges 91,200 380 movements Other overheads 101.400 (see below) Total overhead costs 560,000 There are 2.000 direttabor hours Available sach month Two of KENT's products are a JT101 and a GR27. JT10ls are produced by the Alpha Process in a imple operation. GR27s are manufactured by the Omega Process. Both products are sold by the metre Details of the two products are: JT101 GR21 Monthly volume 1.000 metres 500 metres Batch size 1.000 metres 50 metres Processing time per batch Alpha 100 hours Omega 25 hours Set-ups per batch 1 set-up 2 set-ups Handling charges per batch 1 movement 5 movements Materials per metre 16 15 Direct labour permetre Direct cost) 5 hour hour Direct labour is paid at 16 per bour. 2. The overhead allocation rate per hour, usign the traditional costing system based on direct abour hours, is equal to 125 140 280 62.5