B: Determine the cost per unit for overhead when using direct labor hours as the allocation base and when using ABC.

Snowden Industries produces two electronic decoders, P and Q. Decoder Pis more sophisticated and requires more programming and testing than does Decoder Q. Because of these product differences, the company wants to use activity-based costing to allocate overhead costs. It has identified four activity pools. Relevant information follows: . Activity Pools Repair and maintenance on ansembly machine Programming cost Software inspections Product testing Total overhead cost Cost Pool Total $113,900 145,600 12,000 16,000 $287,500 Cost Driver Number of units produced Number of programming hours Number of inspections Number of tests Expected activity for each product follows: Decoder Decoder o Total Bunber of Unito 20,100 46.900 67,000 Number of Programming Roura 2,300 1,700 4.000 Tumber of Inspections 220 72 300 Number of Test 1,120 880 2,000 Assume that before shifting to activity-based costing, Snowden Industries allocated all overhead costs based on direct labor hours. Direct labor dota pertaining to the two decoders follow: Decoder Decoder o Total Direct Labor lours 6,900 16100 23,000 . Come of caring at the we labores ADC 0 w A o P 5 F O J L X C V 0 N M