25)

Way Cool produces two different models of air conditioners. The company produces the mechanical systems in their components department. The mechanical systems are combined with the housing assembly in its finishing department. The activities, costs, and drivers associated with these two manufacturing processes and the production support process follow.

Process	Activity	Overhead Cost	Driver	Quantity
Components	Changeover		$	480,000		Number of batches	710
	Machining			304,000		Machine hours	8,490
	Setups			233,000		Number of setups	200
			$	1,017,000
Finishing	Welding		$	192,000		Welding hours	5,000
	Inspecting			226,000		Number of inspections	880
	Rework			63,500		Rework orders	240
			$	481,500
Support	Purchasing		$	143,000		Purchase orders	477
	Providing space			38,000		Number of units	5,180
	Providing utilities			65,000		Number of units	5,180
			$	246,000

Additional production information concerning its two product lines follows.

	Model 145	Model 212
Units produced		2,100			3,080
Welding hours		2,000			3,000
Batches		355			355
Number of inspections		480			400
Machine hours		3,150			5,340
Setups		100			100
Rework orders		130			110
Purchase orders		318			159

Required:
1.	Determine departmental overhead rates and compute the overhead cost per unit for each product line. Base your overhead assignment for the components department on machine hours. Use welding hours to assign overhead costs to the finishing department. Assign costs to the support department based on number of purchase orders.(Round your intermediate calculations and per unit cost answers to 2 decimal places.)

2.	Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $290 for Model 145 and $150 for Model 212.(Round your intermediate calculationsand cost per unitanswers to 2 decimal places.)