After reviewing the new activity-based costing system that Nancy Chen has implemented at IVC CenterPoint manufacturing facility, Tom Spencer, the production supervisor, believes that he can reduce production costs by reducing the time spent on machine setups. He has spent the last month working with employees in the plant to change over the machines more quickly with the same reliability. He plans to produce 108,000 units of the Sport model and 44,000 units of the Pro model in the first quarter. He believes that with his more efficient setup routine, he can reduce the number of setup hours for both the Sport and the Pro products by 33 percent Cost Drivers and Cost Driver Volumes-Center Point Manufacturing Facility Cost Driver Volume Activity Cost Driver Sport Pro Total Assembly building Assembling Machine-hours 6,882 38,880 37,600 Setting up Setup hours 48480 528 machines Handling material Production runs 16 4864 Packaging building Inspecting and Direct labor-hours 63,289 24,480 87,600 packing Number of Shipping 10 216 324 shipments Third Quarter Unit Cost Report, Activity-Based Costing-CenterPoint Manufacturing Facility Sport Pro Direct material $1,5e8,eee $2,416,000 Direct labor Assembly $ 758,eee $ 616,000 Packaging 998.se 376.000 Total direct labor $1,756,eee 992.690 Direct costs $3,264.600 $3,488,888 Overhead Assembly building Assembling (@$30 per MH) $ 204,800 $ 924,820 Setting up machine (@$980 per setup hour) 43,209 432,000 Handling material (@$3,000 per run) 48. 144.800 Packaging building Inspecting and packing (@$5 per direct 316,eee 122,899 laborehour) Shipping ($1,32e per shipment) 142,560 285, 120 Total ABC overhead $ 753,768 $1.997, 128 Total ABC cost $4,617,760 $5,315,12 Number of units 188. 44.680 Unit cost 37.29 $ 129.89 Required: a. Compute the amount of overhead allocated to the Sport and the Pro drones for the first quarter using activity-based costing. Assume that all events are the same in the first quarter as in the third quarter except for the number of setup hours. Assume the cost of a setup hour remains at $900 Soort