1. Compute the activity rate for each activity using activity-based costing.
2. Compute overhead cost per unit for each of the two products using activity-based costing.
3. Determine product cost per unit for each of the two products using activity-based costing.

Part 3

  

Northwest Company produces two types of glass shelving: rounded edge and squared edge. The company reports the following cost data. Rounded Edge Squared Edge Total Direct materials Direct labor Total product cost $ 34,200 $ 46,200 Overhead (using plantwide rate) 11,400 40,800 Units produced Product cost per unit $ 86,400 11,400 $ 7.58 30,800 78,400 $ 155,400 15,400 $ 10.09 $ 80,400 42,200 119,200 $ 241,800 Northwest's controller wants to apply activity-based costing to allocate the $119,200 of overhead cost to the two products to see whether product cost per unit would change markedly from that above. The company's budgeted activity usage equals its actual activity usage for the period. The following additional information is collected. Activity Purchasing Budgeted Cost Depreciation of machinery Setup $ 6,100 62,200 50,900 Activity Cost Driver Purchase orders Rounded Edge Machine hours Setups 144 orders 500 hours 40 setups Activity Usage Squared Edge 466 orders 1,500 hours 210 setups Total 610 orders 2,000 hours 250 setups Total $ 119,200 Required: 1. Compute the activity rate for each activity using activity-based costing. 2. Compute overhead cost per unit for each of the two products using activity-based costing. 3. Determine product cost per unit for each of the two products using activity-based costing.