3. Suppose that Ramsey decides to use departmental overhead rates. There are two departments: Department 1: (machine intensive) with a rate of $4 per machine hour and Department 2: (labor intensive) with a rate of $1 per direct labor hour. The consumption of these two drivers is as follows: Compute the overhead cost per unit for each product by using departmental rates. (Round to two decimal places.) Model A:$ per unit Model B: $ per unit 4. Conceptual Connection: Using the activity-based product costs as the standard, comment on the ability of departmental rates to improve the accuracy of product costing. Did the departmental rates do better than the plantwide rate? A common justification is to use hours for machine-intensive departments and hours for labor-intensive departments. Using activity-based costs as the standard, we can say the department rates. the accuracy of the overhead cost assignment for both products and were less accurate than the plantwide rates. The departmental rates cost A well the ABC method while the plantwide rate costs Product A well the ABC method. The departmental rates are not dramatically more wrong then the plantwide rate; however, they are wrong in a direction. The departmental rates do better than the plantwide rates. 1. Compute the overhead cost per unit for each product by using a plantwide rate based on direct labor hours. (Round to two decimal places.) Plantwide rate: $ per DLH. Model A: \$ overhead cost per unit. Model B: \$ overhead cost per unit. 2. Compute the overhead cost per unit for each product by using ABC. (Round rates and unit overhead costs to two decimal places.) Model A: $ overhead cost per unit. Model B: $ overhead cost per unit. Note: Be sure to complete both tables below. Plantwide versus Departmental Rates, Product-Costing Accuracy: Activity-Based Costing Ramsey Company produces speakers (Model A and Model B). Both products pass through two producing departments. Model A's production is much more labor-intensive than that of Model B. Model B is also the more popular of the two speakers. The following data has been gathered for the two products