Exercise 5-6A Computing overhead rates based on different cost drivers LO 5-2, 5-3 Terry Industries produces two electronic decoders, P and Q. Decoder P is 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 infomation follows. Activity Pools Cost Pool Total Cost Driver Repair and maintenance on assembly machine $ 95,000 Number of units produced Programming cost 107,070 Number of programming hours Software inspections 6,500 Number of inspections Product testing 6,440 Number of tests Total overhead cost $215,010 Expected activity for each product follows. Number of Number Programming Number Number of Units Hours of Inspections of Tests Decoder P 25,000 1,700 187 1,200 Decoder Q 25,000 2,600 73 1,600 Total 50,000 4,300 260 2,800