Exercise 5-9A (Algo) Allocating costs with different cost drivers LO 5-2, 5-3 Sheridan Publishing identified the following overhead activities, their respective costs, and their cost drivers to produce the three types of textbooks the company publishes. Type of Textbook Moderate Economy Activity (Coat) Machine maintenance ($320,000) Cost Driver Number of machine hours Deluxe 320 960 1,200. Setups ($650,000) Number of setupa 35 10 5 Packing ($170,000) Number of cartons 25 40 60 Photo development ($780,000) Number of pictures 5,000 3,000 2,000 Deluxe textbooks are made with the finest-quality paper, six-color printing, and many photographs. Moderate texts are made with three colors and a few photographs spread throughout each chapter. Economy books are printed in black and white and include pictures only in chapter openings. Required a. Sheridan currently allocates all overhead costs based on machine hours. The company produced the following number of books during the prior year: Deluxe 50,000 Moderate 150,000 Economy 200,000 Determine the overhead cost per book for each book type. b. Determine the overhead cost per book, assuming that the volume-based allocation system described in Requirement a is replaced with an activity-based costing system. (For all requirements, round your answers to 2 decimal places.) Deluxe Moderate Economy Activity (Cont Coat Driver Machine maintenance ($320,000) Number of machine hours Deluxe 320 Moderate Economy 960 1,280 Setups ($650,000) Number of setups 35 10 5 Packing ($170,000) Number of cartons Photo development ($780,000) Number of pictures 25 5,000 40 60 3,000 2,000 Deluxe textbooks are made with the finest-quality paper, six-color printing, and many photographs. Moderate texts are made with three colors and a few photographs spread throughout each chapter. Economy books are printed in black and white and include pictures only in chapter openings. Required a. Sheridan currently allocates all overhead costs based on machine hours. The company produced the following number of books during the prior year: Deluxe 50,000 Moderate. 150,000 Economy 200,000 Determine the overhead cost per book for each book type. b. Determine the overhead cost per book, assuming that the volume-based allocation system described in Requirement a is replaced with an activity-based costing system. (For all requirements, round your answers to 2 decimal places.) a. Cost per book (volume-based allocation) b. Cost per book (activity-based costing) Deluxe Moderate Economy