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Question: Sheridan Publishing identified the following overhead activities, their respective costs, and the...

Sheridan Publishing identified the following overhead activities, their respective costs, and their cost drivers to produce the three types of textbooks the company publishes. *******(Please Help Solving "Part B") & Provide step by step instructions ***********

		Type of Textbook
Activity (Cost)	Cost Driver	Deluxe			Moderate			Economy
Machine maintenance ($340,000)	Number of machine hours	250			750			1,000
Setups ($730,000)	Number of setups	30			15			5
Packing ($186,000)	Number of cartons	20			40			60
Photo development ($364,000)	Number of pictures	4,000			2,000			1,000

Deluxe textbooks are made with the finest-quality paper, six-color printing, and many photographs. Moderate texts are made with three colors and a few photographs spread throughout each chapter. Economy books are printed in black and white and include pictures only in chapter openings.

Required

Sheridan currently allocates all overhead costs based on machine hours. The company produced the following number of books during the prior year:

Deluxe	Moderate	Economy
54,000	162,000	216,000

A. Determine the overhead cost per book for each book type.

B. Determine the overhead cost per book, assuming that the volume-based allocation system described in Requirement a is replaced with an activity-based costing system.

(For all requirements, round your answers to 2 decimal places.)

Deluxe	Moderate	Deluxe	Moderate	Economy
a.	Cost per book (volume-based allocation)	3.75	3.75	$3.75
b.	Cost per book (activity-based costing)

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