xercise $5-8$A $($Algo$)$ Allocating costs with different cost drivers LO $5-1,5-2,5-3$

Franklin Company produces commercial gardening equipment. Since production is highly automated, the company allocates its overhead costs to product lines using activity$-$based costing. The costs and cost drivers associated with the four overhead activity cost pools follow:

Activities$$Unit LevelBatch LevelProduct LevelFacility LevelCost$ $67,200$$ $19,240$$ $19,000$$ $224,000$Cost driver$2,800$labor hours$37$setupsPercentage of use$14,000$units

Production of $880$ sets of cutting shears, one of the company$$s $20$ products, took $290$ labor hours and $6$ setups and consumed $16$ percent of the product$-$sustaining activities.

Required

Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the cutting shears?

How much overhead is allocated to the cutting shears using activity$-$based costing?

Compute the overhead cost per unit for cutting shears first using activity$-$based costing and then using direct labor hours for allocation if $880$ units are produced. If direct product costs are $$130$ and the product is priced at $30$ percent above cost for what price would the product sell under each allocation system?