Benson Cameras, Inc. manufactures two models of cameras. Model ZM has a zoom lens; Model DS has a fixed lens. Benson uses an activity-based costing system. The following are the relevant cost data for the previous month:

Direct Cost per Unit	Model ZM			Model DS
Direct materials	$	20.20		$	10.20
Direct labor		28.40			12.40

Category	Estimated Cost					Cost Driver	Use of Cost Driver
Unit level		$	24,000			Number of units	ZM: 2,400 units; DS: 9,600 units
Batch level			45,500			Number of setups	ZM: 25 setups; DS: 25 setups
Product level			87,500			Number of TV commercials	ZM: 15; DS: 10
Facility level			270,000			Number of machine hours	ZM: 500 hours; DS: 1,000 hours
Total		$	427,000

1. Compute the cost per unit for each product.

2. The current market price for products comparable to Model ZM is $129 and for DS is $90. If Benson sold all of its products at the market prices, what was its profit or loss for the previous month?

3. A market expert believes that Benson can sell as many cameras as it can produce by pricing Model ZM at $124 and Model DS at $44. Benson would like to use those estimates as its target prices and have a profit margin of 30 percent of target prices. What is the target cost for each product?