2) Fogerty Company makes two productstitanium Hubs and Sprockets. Data regarding the two products follow:

	Direct Labor-Hours per Unit	Annual Production
Hubs	0.80	14,000 units
Sprockets	0.40	54,000 units

Additional information about the company follows:

1. Hubs require $28 in direct materials per unit, and Sprockets require $16.
2. The direct labor wage rate is $15 per hour.
3. Hubs require special equipment and are more complex to manufacture than Sprockets.
4. The ABC system has the following activity cost pools:

Activity Cost Pool (Activity Measure)	Estimated Overhead Cost	Hubs	Sprockets	Total
Machine setups (number of setups)	$22,680	120	96	216
Special processing (machine-hours)	$76,000	3,800	0	3,800
General factory (organization-sustaining)	$140,800	NA	NA	NA

Required:

1. Compute the activity rate for each activity cost pool.

Activity cost pool	Activity Rate
Machine setups	______?_______ Per setup
Special Processing	______?_______ Per MHP

2. Determine the unit product cost of each product according to the ABC system.

	Hubs	Sprockets
Direct materials	?	?
Direct Labor	?	?
Overhead	?	?
Unit cost	?	?