Venus 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 Revenues $357,500 Residential $460,500 Direct materials costs $30,000 Direct labor costs 140,000 Overhead costs 97,500 Operating income (loss) 267,500 $90,000 $50,000 260,000 170,500 480,500 $(20,000) 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 Activity Cost Pools Overhead Cost Drivers Scheduling and travel $97,500 Hours of travel Setup time 110,500 Number of setups Supervision 60,000 Direct labor cost Direct materials costs $30,000 $50,000 Direct labor costs 140,000 260,000 Overhead costs 97.500 Operating income (loss) 267,500 $90,000 170,500 480,500 $(20,000) 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 Activity Cost Pools Overhead Cost Drivers Scheduling and travel $97,500 Hours of travel Setup time 110,500 Number of setups Supervision 60,000 Direct labor cost Estimated Use of Cost Drivers per Product Commercial Residential Scheduling and travel 800 700 Setup time 400 250 Estimated Use of Cost Drivers per Product Scheduling and travel Setup time Commercial Residential 800 700 400 250 (a1) Compute the activity-based overhead rates for each of the three cost pools. (Round overhead rate for supervision to 2 decimal places, e.g. 0.38.) Overhead Rates Scheduling and travel $ per hour Setup time $ per setup. Supervision $ per dollar eTextbook and Media.