Production of 790 sets of cutting shears, one of the companys 20 products, took 260 labor hours and 8 setups and consumed 15 percent of the product-sustaining activities.

1. Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the cutting shears?
2. How much overhead is allocated to the cutting shears using activity-based costing?
3. Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 790 units are produced. If direct product costs are $170 and the product is priced at 25 percent above cost for what price would the product sell under each allocation system?

Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the cutting shears? How much overhead is allocated to the cutting shears using activity-based costing? Note: Round intermediate calculations to 2 decimal places. Round your final answers to the nearest whole dollar amount.

a. Allocated cost

b. Allocated cost

Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 790 units are produced. If direct product costs are $170 and the product is priced at 25 percent above cost for what price would the product sell under each allocation system? Note: Round intermediate calculations and final answers to 2 decimal places.

ABCLabor HoursAllocated overhead Direct cost Total cost per unit Desired profit Sales price