RECOMMENDED!!Company produces computer monitors-Determining overhead allocations

  

Company produces computer monitors. Determining overhead allocations.Five activities:# of purchase orders under purchasing: $400,000# of shipments under receiving: $100,000# of set-ups under machine setups: $300,000Direct Labor hours under assembly: $125,000# of inspections under quality control: $75,000During the year1,000 purchase orders issued300 shipments received600 machine setups10,000 direct labor hours used750 inspections conductedBatch of 200 monitors has resulted in the following cost activity:Purchase orders: 7Shipments received: 12Machine setups: 2Direct labor hours: 50Inspections: 3A. What is the overhead allocation for the 200 monitors under traditional overhead allocation based on direct labor hours?B. What is the overhead allocation for the 200 monitors under activity-based costing?

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