Asian Tools, a manufacturer of precision hand tools, is concerned with the apparent lack of controls over cost incurrence in its Hand Tool Division The division has always used a plant$-$wide rate for allocating manufacturing overhead to its products. However, some products cost substantially more than competitors' retail prices while others are substantially less. The division manager belie ves that a better cost allocation method can be developed.

With the assistance of a plant supervisor, the accounting department has been able to establish the following relationshipe between production activities and the indirect costs of the activities:

Activity

Material handling

Machine stamping

Finishing Time

Cost Driver

Number of parts

Machine hours

Finishing minutes

Allocation Rate

$$2\mathrm{.}60$ per part

$$60\mathrm{.}00$ per hour

$$4\mathrm{.}00$ per minute

The traditional allocation method is based upon direct manufacturing labour hours, and if that method is used the rate is $$28$ per hour.

Required:

Compute the unit indirect manufacturing costs of a batch of $200$ tools if the batch required $220$ parts, $8$ machine hours, $52$ minutes of finishing time, and $46$ direct labour hours: