• Carmen Company produces 50,000 units of Product Q and 6,000 units of Product Z during a period. In that period, four set-ups were required for color changes. All units of Product Q are black, which is the color in the process at the beginning of the period. A set-up was made for 1,000 blue units of Product Z; a set-up was made for 4,500 red units of Product Z; a set-up was made for 500 green units of Product Z. A set-up was then made to return the process to its standard black coloration and the units of Product Q were run. Each set-up costs P500.

(USE THREE-DECIMAL PLACES)

1. If set-up cost is assigned on a volume basis for the department, what is the approximate per-unit set-up cost for Product Z?
2. Assume that Carmen Company has decided to allocate overhead costs using levels of cost drivers. What would be the approximate per-unit set-up cost for the blue units of Product Z?
3. Assume that Carmen Company has decided to allocate overhead costs using levels of cost drivers. What would be the approximate per-unit set-up cost for the green units of Product Z?

• Kenyon Company produces two products (F56 and F57), applying manufacturing overhead on the basis of direct labor hours.Anticipated unit production costs (material, labor, and overhead) and manufacturing volumes are:

F56: 2,000 units, $234

F57: 3,500 units, $271

Kenyon's overhead arises because of various activities, one of which is purchase-order processing.Budgeted cost for this activity is expected to be $70,000.The firm believes that the number of purchase orders processed is a key cost driver and expects the following activity for its products: F56, 10 purchase orders; F57, 40 purchase orders.Kenyon's selling prices are based heavily on cost.

1. Compute the pool application rate for purchase-order processing.
2. Compute the purchase-order processing cost to be charged to one unit of F56