Learning Objectives 1, 2 2. Travel packs 52.48 per unit > Problems Group A P24-27A Comparing costs from ABC and single-rate systems Corbert Pharmaceuticals manufactures an over-the-counter allergy medication. The company sells both large commercial continens of 1.000 capsules to health-care facilities and travel packs of 20 capsules to shops in airports, train stations, and hotels. The following information has been developed to determine if an activity-based costing system wald be bencficial: Estimated Estimated Quantity Activity Indirect Cost Allocation Base of Allocation Base Materials handing $ 95,000 Number of los 19,000 kilos Packaging 225.000 Number of machine hours 3,000 hours Quality assurance Number of samples 1,500 samples Total Indirect costs 5444.500 124.500 Actual production information includes the following: Commercial Containers Travel Packs Units produced 3,500 containers 57,000 packs Weight in kilos 13,485 5.515 Machine hours 2,430 570 Number of samples 645 855 Requirements 1. Compute the predetermined overhead allocation rate for cach activity. 2. Use the predetermined overhead allocation rates to compute the activity-based costs per unit of the commercial containers and the travel packs. Round to two decimal places. (Hint: First compute the total activity-based costs allocated to cach product line, and then compute the cost per unit.) 3. Corbertt's original single plantwide allocation rate costing system allocated indirect costs to products at $148.17 per machine hour. Compute the total indirect costs allocated to the commercial containers and to the travel packs under the original system. Then compute the indirect cost per unit for each product. Round to two decimal places. 4. Compare the indirect activity-based costs per unit to the indirect costs per unit from the traditional system. How have the unit costs changed? Explain why the costs changed