Number 28

After reviewing the new activity based cosung system that Nancy Chen has implemented at ivC's Cesterpoint manufacturing facility. Tom Spencer, the production supervisor, believes that he can reduce production costs by reducing the time spent on machine setups. He has spent the last month working with employees in the plant to change over the machines more cuichly with the same rellabilly He plans to produce 100,000 units of the Sport model and 40,000 units of the Pro model in the first quartec. He believes that with his more efficient setup routine, he can feduce the number of setup hours for both the Sport and the Pro products by one-third. Cost Drivers and Cost Driver Volumes-CenterPoint Mandacturing Facility Therd Quaster Unit Cost Report, Activiny - Based Costing-Center Point Manufacturing Facility a. Compute the amount of overhead allocated to the Sport and the Pro drones for the first quarter using activity-based costing. Assume that all events are the same in the first quarter as in the third quarter except for the number of setup hours. Assume the cost of a setup hour remains at $900