Exercise 17-17 Activity-based costing LO P3 Glassworks Inc. produces two types of glass shelving, rounded edge and squared edge, on the same production line. For the currer period, the company reports the following data. Direct materials Direct labor overhead (3001 of direct labor cost) Total cost Quantity produced Average cost per ft. (rounded) Rounded Edge $ 9,500 6,200 18,600 $34,300 10,500 ft. $ 3.27 Squared Edge Total $21,600 $ 31,100 11,800 18,000 35,400 54,000 $68,800 $103, 100 14,000 ft. $ 4.91 Glassworks's controller wishes to apply activity-based costing (ABC) to allocate the $54,000 of overhead costs incurred by the two product lines to see whether cost per foot would change markedly from that reported above. She has collected the following information Overhead Cost Category (Activity Cost Pool) Supervision Depreciation of machinery Assembly line preparation Total overhead Cost $ 2,160 28,840 23,000 $ 54,000 She has also collected the following information about the cost drivers for each category (cost pool) and the amount of each driver used by the two product lines. (Round activity rate and cost per unit answers to 2 decimal places.) Usage Overhead Cost Category (Activity Cont Pool) Supervision Depreciation of machinery Assembly line preparation Driver Direct labor cost (5) Machine hours Setups (number) Rounded Edge $6,200 400 hours 30 times Squared Edge $11,800 800 hours 95 times Total $18,000 1,200 hours 125 times Activity Rate Required: 1. Assign these three overhead cast pools to each of the two products using ABC. Activity Overhead Cost Activity Drivers Supervision Direct labor cost Depreciation of machinery Machine hours Assembly fine preparation Setups Rounded edge Activity rate Supervision % Depreciation of machinery Assembly line preparation Activity driver incurred Overhead assigned Activity rate Activity driver incurred Overhead assigned Squared edge Components Supervision Depreciation of machinery % 2. Determine average cost per foot for each of the two products using ABC. Rounded edge Squared edge