View Police Current Attempt in Progress Venus Creations sells window treatments Ishades, blinds, and awnings to both commercial and residential customers. The following information relates to its budgeted operations for the current year Revenues Direct materials costs Direct labor costs Overhead costs Operating Income loss Commercial $395.050 $30.000 150.000 85.050 265.050 $90.000 Residential $425.000 $50000 250.000 145.000 445.000 $120.000 The controller Peggy Kingman is concerned about the residential product line She cannot understand why this line is not more profitable given that the installations of window.coverings are less complex for residential customers. In addition, the residential dient base resides in close proximity to the company office, se travel costs are not as Expensive ona per client visit for residential customers. As a result she has decided to take a closer look at the overhead costs assigned to the two product lines to determine whether a more accurate product costing model can be developed Here are the three activity cost pools and related information She developed Activity Cost Pools Scheduling and travel Setuptime Supervision Estimated Overhead $85.050 105.000 40,000 Cost Drivers Hours of travel Number of setups Direct labor cost Estimated Use of Cost Drivers per Product Commercial Residential Scheduling and travel 800 SSO Setup time 500 250 Compute the activity based overhead rates for each of the three cost pools Overhead Rates Scheduling and travel $ per hour Setup time $ per setup Supervision 34 eTextbook and Media Determine the overhead cost assigned to each product line. Commercial Residential Scheduling and travel $ $ Setup time s Supervision $ Total cost assigned e Textbook and Media Compute the operating income for each product line, using the activity-based overhead rates Operating income (loss) $ Commercial Residential $