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a. Compute the overhead cost assigned to each type of bicycle assuming direct labor hours is used to allocate oveEstimated bicycles producedDirect labor hours per bicycleTotal Direct labor hours usedCruising30000130000Estimated overhead for the two product lines = SAR 900,000Overhead Cost per Labour hourOverhead Cost Assigned (based on direct labor hours)10300000b. The controller is not satisfied with the traditional method of allocating overhead because he believes that mosMountain bicycle product line because of its complexity. He therefore developed the following three activity costbetter understand these costs.Compute the activity-based overhead rates for these three cost pools.Activity Cost PoolsSetting up machinesAssemblingInspectionExpected Use of Cost Drivers1,000 setups90,000 labor hours1,200 inspectionsActivitySetting up machinesAssemblingInspectionActivity Pools Cost (SAR)150000630000120000**ABC rate = Activity Pools Cost / Cost Driver Qty.c. Compute the cost that is assigned to each bicycle product line using activity-based costing system, given the foExpected Use of Cost Drivers per ProductNumber of setupsDirect labor hours ...


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