49) Lens Care Inc. (LCI)

Lens Care Inc, (LCI) manufactures specialized equipment for polishing optical lenses, There are two models 7 one mainly used for fine eyewear (F732) and another for lenses used in binoculars, cameras, and similar equipment (8-13). The manufacturing cost ofeach unit is calculated using activityrbased costing, using the following manufacturing cost pools: Cost Pools Allocation Base Costing Rate Materials handling Number of parts $ 4.39 per part Manufacturing supervision Hours of machine time $ 14.99 per hour Assembly Number of parts 3 4.25 per part Machine setup Each setup $ 57.45 per setup Inspection and testing Logged hours $46.45 per hour Packaging Logged hours $ 29.45 per hour LCI currently sells the B43 model for $6,050 and the F732 model for $6,540. Manufacturing costs and activity usage for the two products are as follows: B13 F32 Direct materials s 1.65.45 $ 76.36 Number of parts 179 139 Machine hours 8.85 4.39 Inspection time 3.66 2.70 Packaging time 1.85 1.45 Setups 5 4 The profit margin based on manufacturing cost for model F732 is