The ABC system at MovieTime contains the following activity cost pools and activity rates this year:

Activity Total activity

Quality control and Inspection 4800 units produced

Delivery and Installation 1200 deliveries

Order Processing 920 orders processed

Other None

Activity data have also been supplied for the leather recliner product line:

Activity Total activity for the leather recliner

product line

Quality control and Inspection 1200 units produced

Delivery and Installation 300 deliveries

Order Processing 230 orders processed

Required:

1. Using the first-stage allocation from Exercise 7-3 and the above data, compute the activity rates for the ABC system. (Use Exhibit 7-8 as a guide.) Round to the nearest whole cent.

2. Determine the total overhead cost that would be assigned to the leather recliner product line using

the ABC system.