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-pur pose 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)]. Expected annual manufacturing overhead is $1,584,600. Thus, the is $16.45 or ($1,584,600+96,300) per direct labor hour. The direct materials cost per unit is $18.50 for predetermined overhead rate 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 Expected Use of Drivers by Product Expected Use of Activity Cost Pools Cost Drivers Estimated Overhead Cost Drivers Home Commercial 120,000 8,000 52,000 Receiving Forming Assembling Testing $89,200 154,000 410,000 49,000 60,400 822,000 $1,584,600 Pounds Machine hours Number of parts Number of tests Gallons Pounds 335,000 215,000 35,00027,000 217,000 165,000 25,500 15,500 5,2583,680 335,000 215,000 3680 10000 Painting 1,578 Packing and shipping 120,000 Under traditional product costing,compute the total unit cost of each product. (Round answers to 2 decimal places es, 1225) Home Model Commercial Model Total unit cost$ Under ABC, prepare a schedule showing the computations rate to 2 decimal places, eg. 12.25.) of the activity-based overhead rates (per cost driver). (Round overhead Activity Cost Pool Estimated Overhead Expected Use of Cost Drivers Activity-Based Overhead Rate Recelving Pounds per pound per machine hour per part per test Machines hours Forming Assembling Parts Tests Gallons Testing Painting per sallon Packing and shipping Pounds pound Home Model Activity Cost Pool Expected Use of Drivers Activity-Based Overhead Rates Expected Use of Drivers Cost Assigned Recelving Forming Assembling Testing Painting Packing and shipping Total costs assigned (a) Units produced Overhead cost per unit [(a) + Compute the total cost per unit for each product under ABC. (Round answer to 2 decimal places, e 12.25 Home Model Commercial Model Total cost per unit $ Classity each of the activities as a value-added activity or a non-value-added activity. Activity Receiving Forming Assembling Testing Painting Packing and shipping
