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Swifty Creations sells window treatments (shades, blinds, and awnings) to both commercial and residential customers. The following Information relates to its budgeted operations for the

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Swifty Creations sells window treatments (shades, blinds, and awnings) to both commercial and residential customers. The following Information relates to its budgeted operations for the current year Commercial $315,000 $30,000 Revenues Direct materials costs Direct labor costs Overhead costs Operating income (loss) Residential $404.000 $50,000 250,000 124.000 424.000 $(20,000) 150,000 75,000 255,000 $60,000 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: 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 $75,000 Activity Cost Pools Scheduling and travel Setup time Supervision Cost Drivers Hours of travel Number of setups Direct labor cost 84,000 40,000 Estimated Use of Cost Drivers per Product Commercial Residential Scheduling and travel 700 550 Setup time 350 250 Compute the activity-based overhead rates for each of the three cost pools. (Round answers to 2 decimal places, e.8.0.38.) Overhead Rates Scheduling and travel $ 80 per hour Setup time $ 140 per setup Supervision $ 0310 per dollar Determine the overhead cost assigned to each product line. Commercial Residential Scheduling and travel $ $ Setup time $ Supervision $ Total cost assigned $ $

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