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Chris Anderson has been studying his department's profitability reports for the past six months. He has just completed a managerial accounting course and is beginning to question the company's approach to allocating overhead to products based on machine hours. The current department overhead budget of $1,141,500 is based on 45,660 machine hours. In an initial analysis of overhead costs, Chris has identified the following activity cost pools. Cost Pool Product assembly Machine setup and calibration Product inspection Raw materials storage Expected Cost $ 780,000 270,000 Expected Activities 39,000 machine hours 4,500 setups 54,000 1,350 batches 37,500 250,000 pounds $ 1.141,500 Chris Anderson is taking the next step in his exploration of activity-based costing and wants to examine the overhead costs that would be allocated to two of the department's four products. He has gathered the following budget information about each product Chris Anderson is taking the next step in his exploration of activity based costing and wants to examine the overhead costs that would be allocated to two of the department's four products. He has gathered the following budget information about each product Component 3F5 Component T76 Driver Usage Machine hours 1,000 11.000 Setups 20 44 Batches 20 15 Pounds of raw materials 10,000 10,000 (al Calculate the total overhead allocated to each component under the traditional method using machine hours as the overhead application base. Component 3F5 Component T76 $ 25000 $ 275000 Total Overhead allocated (a) Calculate the total overhead allocated to each component under the traditional method using machine hours as the overhead application base Component 3F5 Component T76 $ 25000 275000 Total Overhead allocated (b) Calculate the total overhead allocated to each component under activity based costing. (Round overhead rates to 2 decimal places, 28. 5.27 ond round final answers to decimal places, $ 5,275) Component 3F5 Component 176 $ 24740 210791 Total Overhead allocated

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