Exercise 12-3A (Algo) Allocating overhead cost to accomplish smoothing LO 12-2 Fanning Corporation expects to incur indirect overhead costs of $78,325 per month and direct manufacturing costs of $19 per unit. The expected production activity for the first four months of the year are as follows. January February March April Estimated production in units 4,700 8,800 3,800 6,800 Required Calculate a predetermined overhead rate based on the number of units of product expected to be made during the first four months of the year. Allocate overhead costs to each month using the overhead rate computed in Requirement a. Calculate the total cost per unit for each month using the overhead allocated in Requirement b. Allocate overhead costs to each month using the overhead rate computed in Requirement a. Month Allocated Cost January February March April Total Calculate the total cost per unit for each month using the overhead allocated in Requirement b. Month January February March April Number of units 4,700 8,800 3,800 6,800 Expected cost Overhead Direct costs Total cost Cost per unit