Williamson CVBA currently assigns overhead costs to products solely based on the number of units produced, and are looking at changing to an activity based costing system with a two-step allocation of overhead costs. In the first stage, two overhead costs - Security expense and Insurance expense - would be allocated to three activity cost pools - Shipping, Finishing, and Other - based on resource consumption. Data to perform these allocations appear below:

Overhead Costs:

• Security expense: $550,000
• Insurance expense: $1,000,000

Distribution of Resource Consumption across Activity Cost Pools:

Overhead Cost	Activity Cost Pools
	Shipping	Finishing	Other
Security expense	0.40	0.20	0.40
Insurance expense	0.25	0.35	0.40

In the second stage, Shipping costs would be assigned to products using orders shipped and Finishing costs would be assigned to products using the number of direct labor hours. The costs in the Other activity pool would not be assigned to products. Activity data for the company's two products is as follows:

	orders shipped	direct labor hours	Units Produced
Product XR-7:	14,000	29,000	9,700
Product BA-05:	30,000	15,000	2,200
Total:	44,000	44,000	11,900

PART A:

How much overhead cost would be assigned to the Shipping activity cost pool under activity based costing in the first stage of allocation?

PART B:

The activity rate for the Shipping activity cost pool under activity based costing would be closest to:

PART C:

To the nearest dollar, how would the overhead cost assigned to Product BA-05 change under activity based costing compared to their current accounting methods?

There would be __________ in assigned overhead under activity based costing, and the amount of the change would be $__________