Combat Fire, Inc. manufactures steel cylinders and nozzles for two models of fire extinguishers: (1) a home fire extinguisher and (2) a commercial fire extinguisher. The home model is a high-volume (54.000 units), half-gallon cylinder that holds 2 1/2 pounds of multi- purpose dry chemical at 480 PSI. The commercial model is a low-volume (10,200 units), two-gallon cylinder that holds 10 pounds of multi-purpose dry chemical at 390 PSI. Both products require 1.5 hours of direct labor for completion. Therefore, total annual direct labor hours are 96,300 or (1.5 hours * (54,000 + 10,200)]. Estimated annual manufacturing overhead is $1,577,770. Thus, the predetermined overhead rate is $16.38 or ($1,577.770 = 96,300) per direct labor hour. The direct materials cost per unit is $18.50 for the home model and $26.50 for the commercial model. The direct labor cost is $19 per unit for both the home and the commercial models The company's managers identified six activity cost pools and related cost drivers and accumulated overhead by cost pool as follows Estimated Use of Drivers by Product Activity Cost Pools Cost Drivers Estimated Use of Cost Drivers Estimated Overhead Home Receiving Pounds $80,400 335,000 215,000 27,000 Commercial 120,000 8,000 Forming 150,850 35,000 Assembling Machine hours Number of parts Number of tests 414,470 217,000 165,000 52,000 Testing 52,020 25,500 15,500 10,000 Gallons 52,580 5,258 3,680 1,578 Painting Packing and shipping Pounds 827,450 335,000 215,000 120,000 $1,577,770 Under traditional product costing, compute the total unit cost of each product. (Round answers to 2 decimal places, eg. 12.50.) Home Model Commercial Model Total unit cost $ $ Under ABC, prepare a schedule showing the computations of the activity-based overhead rates (per cost driver). (Round overhead rate to 2 decimal places, eg. 12.25.) Activity Cost Pool Estimated Overhead Estimated Use of Cost Drivers Activity-Based Overhead Rate Pounds $ $ per pou Receiving Machine hours $ per mar hou Forming Parts per par Assembling Tests $ per Testing per gall Painting Gallons Pounds Packing and shipping per pou $ e Textbook and Media Prepare a schedule assigning each activity's overhead cost pool to each product based on the use of cost drivers. (Round overhead cost per unit to 2 decimal places, eg. 12.25 and cost assigned to O decimal places, eg. 2,500.) Home Model Activity-Based Overhead Rates Activity Cost Pool Estimated Use of Drivers Estimated Drive Cost Assigned Receiving $ $ Forming $ Asse ling $ Testing $ Painting $ $ Packing and shipping $ Total costs assigned (a) $ Units produced (b) Overhead cost per unit (a) + (b)] $ e Textbook and Media Compute the total cost per unit for each product under ABC. (Round answer to 2 decimal places, eg. 12.25.) Home Model Commercial Model Total cost per unit $ $ e Textbook and Media Classify each of the activities as a value-added activity or a non-value-added activity. Activity Receiving Forming Assembling
