Isadores Implements, Inc., manufactures pens and mechanical pencils often used for gifts. Overhead costs are currently allocated using direct labor-hours, but the controller has recommended an activity-based costing system using the following data:

Isadore's Implements, Inc., manufactures pens and mechanical pencils often used for gifts. Overhead costs are currently allocated using direct labor-hours, but the controller has recommended an activity-based costing system using the following data: Cost Driver Volume Cost Driver Pencil Pens Sting Number of setuns Number of parts Number of boxes shipped $108,300 27,000 67,500 up Inspecting Packing and shipping 4 6 85.000 50,000 $202.800 Total overhead Required: a. Compute the amount of overhead to be allocated to each product under activity-based costing. (Do not round intermediate calculations.) Overhead Pencils Pens b. Compute the amount of overhead to be allocated to each product using labor-hours as the allocation base. Assume that the number of labor-hours required to assemble each box is 0.2 for pencils and 0.1 for pens and that 50,000 boxes pencils and 85,000 boxes of pens were produced during the period. (Do not round intermediate calculations.) Overhead Pencils Pens