Rankin Industries produces two surge protectors: K2761 with six outlets and D3354 with eight outlets and two telephone line connections. Because of these product differences, the company plans to use activity-based costing to allocate overhead costs. The company has identified four activity pools. Relevant information follows:

Expected activity for each product follows:

Required
a. Compute the overhead rate for each activity pool.
b. Determine the overhead cost allocated to each product.

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Activity Pools Cost Pool Total Cost Driver Machine setup Machine operation Quality control Packaging Total overhead cost $180,000 450,000 72,000 Number of setups Number of machine hours Number of inspections Number of units $750,000 K2761 D3354 Total Number of Setups 48 72 120 Number of Machine Hours 1,400 2,600 4,000 Number of Inspections 78 172 250 Number of Units 25,000 15,000 40,000