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George Robinson has been studying his department's profitability reports for the past six months. He has just completed a managerial accounting course and is beginning

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George Robinson has been studying his department's profitability reports for the past six months. He has just completed a managerial accounting course and is beginning to question the company's approach to allocating overhead to products based on machine hours. The current department overhead budget of $ 1,075,750 is based on 43,030 machine hours. In an initial analysis of overhead costs, George has identified the following activity cost pools. Cost Pool Expected Cost Expected Activities Product assembly $ 630,000 42,000 machine hours Machine setup and calibration 325,000 5,000 Setups Product inspection 63,000 1,400 batches Raw materials storage 57,750 275,000 pounds $ 1,075,750 George Robinson is taking the next step in his exploration of activity-based costing and wants to examine the overhead costs would be allocated to two of the department's four products. He has gathered the following budget information about each product. Component 3F5 Component 176 Driver Usage Machine hours 1,100 10,500 Setups 37 18 Batches 20 10 Pounds of raw materials 10,000 10,000 (a) Calculate the total overhead allocated to each component under the traditional method using machine hours as the overhead application base. Component 3F5 Component 176 Total Overhead allocated $ (b) Calculate the total overhead allocated to each component under activity-based costing. (Round overhead rates to 2 decimal places, e.g. 5.27 and round final answers to 0 decimal places, e.g. 5,275.) Component 3F5 Component 176 Total Overhead allocated $ $

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