3. Assume that actual activity is as expected for the year. Using activity-based costing, do the following: a. Determine the total amount of overhead that would be applied to each model for the year. (Do not round intermediate calculations and round your final answers to nearest whole dollar amount.) Total overhead cost % 23434800 % 3,695,228 b. Compute the unit product cost for one unit of each model. (Do not round intermediate calculations and round your answers to 2 decimal places.) Unit product cost 3 62921 & 25945 2. An intern suggested that the company use activity-based costing to cost its products. A team was formed to investigate this idea, and it came back with the recommendation that four activity cost pools be used. These cost pools and their associated activities follow: L. Estimated Actiuity Activity Cost Pool and Overhead Activity Measure Cost Luxury Standard Total Purchase orders (number of orders) % 545,448 1,008 1,488 2,408 Rework requests (number of requests) 318,900 328 1,260 2,000 Product testing {number of tests) 1,158,368 5,808 7,688 12,006 Machine related (machine hours) 4,016,800 15,888 25,6800 40,008 $6,038,708 Compute the activity rate (i.e, predetermined overhead rate) for each of the activity cost pools. Purchase orders Rework requests Product testing Machine related Maple Woods Inc. manufactures lounge chairs available in both a luxury and a standard model. The company has made the standard model for years; the luxury model was introcduced several years ago to capture a new segment of the market. Since the introduction of the luxury model, the company's profits have steadily declined, and management has become concerned about the accuracy of its costing system. Sales of the luxury model have been increasing rapidly. Overhead is applied to products on the basis of direct labour hours. At the beginning of the current year, management estimated that $6,038,708 in averhead costs would be incurred and the company would produce and sell 5,900 units of the luxury model and 43,240 units of the standard model. The luxury model requires 3.0 hours of direct labour time per unit, and the standard model requires 2.0 hours. Materials and labour costs follow: Luxury Standard Direct materials cost per unit $178 $138 Direct labour cost per hour 18 18 Required: 1. Compute the predetermined overhead rate using direct labour hours as the basis for allocating overhead costs to products. Compute the unit product cost for one unit of each model. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Predetermined overhead rate Unit product cost of Luxury Unit product cost of Standard