Combat Fire, Inc. manufactures steel cylinders and nozzles for two models of fire extinguishers: (1) a home fire extinguisher and (2) a commercial fire extinguisher. Thehome modelis a high-volume (54,000 units), half-gallon cylinder that holds 2 1/2 pounds of multi-purpose dry chemical at 480 PSI. Thecommercial modelis a low-volume (10,200 units), two-gallon cylinder that holds 10 pounds of multi-purpose dry chemical at 390 PSI. Both products require 1.5 hours of direct labor for completion. Therefore, total annual direct labor hours are 96,300 or [1.5 hours (54,000 + 10,200)]. Estimated annual manufacturing overhead is $1,573,108. Thus, the predetermined overhead rate is $16.34or ($1,573,108 96,300) per direct labor hour. The direct materials cost per unit is $18.50 for the home model and $26.50 for the commercial model. The direct labor cost is $19 per unit for both the home and the commercial models.

The company's managers identified six activity cost pools and related cost drivers and accumulated overhead by cost pool as follows.

Estimated Use of

Drivers by Product

Activity Cost Pools

Cost Drivers

Estimated Overhead

Estimated Use of

Cost Drivers

Home

Commercial

ReceivingPounds$87,100

335,000

215,000

120,000

FormingMachine hours150,150

35,000

27,000

8,000

AssemblingNumber of parts399,280

217,000

165,000

52,000

TestingNumber of tests47,940

25,500

15,500

10,000

PaintingGallons57,838

5,258

3,680

1,578

Packing and shippingPounds830,800

335,000

215,000

120,000

$1,573,108