Viola & Drum Ltd produces affordable musical instruments for schools. Aneena Frost, the chief accountant, is reviewingthe company's current approach toallocate overheads to products. Currently the company absorbs overheads based on direct labour hours. Aneena feels that the company should switch to activity-based costing (ABC), as theproduct lines make different demands on the company's overhead resources -in particular, their violinmodel "Stradicrazy" requires a lot of advance preparation. Thefollowing information about their two main product models is available to assist in your calculations:

StradiCrazy DrumOn (DO) (SC) Materials $36 E18 Kilos per unit (for wood) 3kgs 1.5kgs Labour hours per unit 1 2 Sales price $63 $58 Sales demand 3,200 3,600 Overhead costs: Employee-related $74,500 Driven by labour hours Quality testing f17,145 Driven by number of units Material movements $60,000 Driven by number of kilos Direct labour is charged as $9 per labour hour