Cornell Company produces two lawn mowers: basic and self-propelled. The company has four activities: machining, engineering, receiving, and packing. Information on these activities and their drivers is given below.

Required:
1. Calculate the four activity rates.
2. Calculate the unit costs using activity rates. Also, calculate the overhead cost per unit.
3. What ifconsumption ratios instead of activity rates were used to assign costs instead of activity rates? Show the cost assignment for the inspection activity.LO1

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Units produced Prime costs Machine hours Basic Self-Propelled Total 250,000 750,000 $20,000,000 $75,000,000 $95,000,000 250,000 1,250,000 1,500,000 Engineering hours 1,000 9,000 10,000 Receiving orders 1,000 3,000 4,000 2,000 4,000 6,000 Inspection hours Overhead costs: Machining $15,000,000 Engineering 5,000,000 Receiving 1,400,000 Inspecting products 900,000