Cullumber Inc. manufactures two products: car wheels and truck wheels. To determine the amount of overhead to assign to each product line, the controller, Robert Williams, has developed the following information: Car Truck Estimated wheels produced 45,000 18,000 Direct labour hours per wheel 4 8 Total estimated overhead costs for the two product lines are $1,620,000. Calculate the overhead cost assigned to the car wheels and truck wheels, assuming that direct labour hours are used to allocate overhead costs. Car wheels ta 900000 Truck wheels ta 720000 Total overhead $ ta 1620000 e Textbook and Media Attempts: unlimited Robert is not satisfied with the traditional method of allocating overhead because he believes that most of the overhead costs relate to the truck wheel product line because of its complexity. He therefore develops the following three activity cost pools and related cost drivers to better understand these costs: Estimated Overhead Costs Activity Cost Pools Estimated Use of Cost Drivers Setting up machines $530,000 1,000 set-ups Assembling 370,000 37,000 labour hours Inspection 720,000 1,440 inspections Calculate the activity-based overhead rates for these three cost pools. Cost Pool Rate Setting up machines $ 530 per set-up Assembling $ 10 per labour hour Inspection $ 500 per inspection Calculate the cost that is assigned to the car and truck product lines using an activity-based costing system, given the following information: Use of Cost Drivers per Product Car Truck Number of set-ups 190 810 Direct labour hours 21,400 15,600 Number of inspections 60 1,380 Car Truck Overhead assigned $ $ e Textbook and Media