10. Vertex Tires manufactures tires for dune buggies and has two different products, nubby tires and smooth tires. The company produces 5,000 nubby tires and 10,000 smooth tires each year and incurs $167,000 of overhead costs. The following information is available:

Activity Total Cost Cost Driver

Materials handling $60,000 Number of requisitions

Machine setups 50,000 Number of setups

Quality inspections 57,000 Number of inspections

For the nubby tires, the company has 400 requisitions, 200 setups, and 200 inspections. The smooth tires require 600 requisitions, 300 setups, and 400 inspections.

Instructions

Determine the overhead rate for each activity.

11. S.C. Johnson Manufacturing has five activity cost pools and two products (a budget lawnmower and a deluxe lawnmower). Information is presented below:

Activity Cost Pool	Cost Driver	Est. Overhead	Cost Drivers by Product Budget Deluxe		Overhead Rate
Ordering and Receiving	Orders	$120,000	600	400	$120/order
Machine Setup	Setups	297,000	500	400	$330/setup
Machining	Machine hours	1,000,000	150,000	100,000	$4/machine hour
Assembly	Parts	1,400,000	1,200,000	800,000	$0.70/part
Inspection	Inspections	300,000	550	450	$300/inspection

Instructions

Compute the overhead cost per unit for each product. Production is 700,000 units of Budget and 200,000 units of Deluxe. Round your answer to the nearest cent.