Cost Drivers and Cost Driver VolumesCenterPoint Manufacturing Facility

Activity	Cost Driver	Cost Driver Volume
		Sport	Pro	Total
Assembly building
Assembling	Machine-hours	7,200	31,200	38,400
Setting up machines	Setup hours	52	520	572
Handling material	Production runs	20	52	72
Packaging building
Inspecting and packing	Direct labor-hours	64,800	25,200	90,000
Shipping	Number of shipments	112	224	336

Third Quarter Unit Cost Report, Activity-Based CostingCenterPoint Manufacturing Facility

	Sport	Pro
Direct material	$ 1,512,000	$ 2,424,000
Direct labor
Assembly	$ 762,000	$ 624,000
Packaging	1,002,000	384,000
Total direct labor	$ 1,764,000	$ 1,008,000
Direct costs	$ 3,276,000	$ 3,432,000
Overhead
Assembly building
Assembling (@ $30 per MH)	$ 216,000	$ 936,000
Setting up machines (@ $900 per setup hour)	46,800	468,000
Handling material (@ $3,000 per run)	60,000	156,000
Packaging building
Inspecting and packing (@ $5 per direct labor-hour)	324,000	126,000
Shipping (@ $1,320 per shipment)	147,840	295,680
Total ABC overhead	$ 794,640	$ 1,981,680
Total ABC cost	$ 4,070,640	$ 5,413,680
Number of units	112,000	46,000
Unit cost	$ 36.35	$ 117.69

Required:

Compute the amount of overhead allocated to the Sport and the Pro drones for the first quarter using activity-based costing. Assume that all events are the same in the first quarter as in the third quarter except for the number of setup hours. Assume the cost of a setup hour remains at $900.

Model Total ABC Overhead

Sport =

Pro =