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PRINTER VERSION BACK NEXT Commercial Residential $299,400 $483,000 Revenues Direct materials costs $30,300 Direct labor costs Overhead costs Operating income (loss) $49,500 289,500 110,600 90,700

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PRINTER VERSION BACK NEXT Commercial Residential $299,400 $483,000 Revenues Direct materials costs $30,300 Direct labor costs Overhead costs Operating income (loss) $49,500 289,500 110,600 90,700 231,600 149,000 488,000 $67,800 $(5,000 The controller, Peggy Kingman, is concerned about the residential product line. She cannot understand why this line is not more profitable given that the installations of window coverings are less complex for residential customers. In addition, the residential client base resides in close proximity to the company office, so travel costs are not as expensive on a per client visit for residential customers. As a result, she has decided to take a closer look at the overhead costs assigned to the two product lines to determine whether a more accurate product costing model can be developed. Here are the three activity cost pools and related information she developed Estimated Overhead Activity Cost Pools Cost Drivers Scheduling and travel Setup time Supervision $88,000 101,700 50,000 Hours of travel Number of setups Direct labor cost Expected Use of Cost Drivers per Product Commercial Residential Scheduling and travel Setup time 760 360 590 230 Your answer is partially correct. Try again. Compute the activity-based overhead rates for each of the three cost pools. (Round answers to 2 decimal places, e.g. 12.25.) Overhead Rates Scheduling and travel Setup time Supervision 65.19 172.37 12

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