Warren Furniture produces three models of desk chairs: Basic, Ergo, and Exec. The cost system at the Warren production facility allocates overhead cost on the basis of direct labor hours. The company is considering updating its cost system to an activity-based costing system and is interested in understanding the effects. A study team composed of the production facility's finance and operations groups has identified three overhead cost pools along with appropriate cost drivers for each pool. Cost Pools Costs Activity Drivers Assembly $ 1,215,000 Direct labor-hours Setup 1,080,000 Number of setups Quality assurance 585,000 Number of tests The plans for produc