........: Data table Mathematical Financial 50,000 125,000 $ 175,000 $ $ 75,000 $ Annual production in units Direct materials cost Direct manufacturing labor cost Direct manufacturing labor-hours Machine-hours Number of production runs Inspection-hours 437,500 187,500 7,500 50,000 3,000 20,000 50 50 1,000 500 > Data table Total $ Machining costs Setup costs Inspection costs 490,000 135,000 120,000 Requirement 1. Choose a cost driver for each overhead cost pool and calculate the manufacturing overhead cost per unit for each product. Begin by choosing a cost driver for each overhead cost pool. Cost driver Rate Activity Machining Machine-hours $ 5 per machine-hour Set up Production runs 1 $ 1,170 per production run $ 80 per inspection-hour Inspection Inspection-hours Determine the formula to calculate the overhead allocated to each product. Indirect-cost rate Product quantity of allocation base - Overhead allocated to product Now calculate the total overhead allocated to each product and the overhead cost per unit. (Round your answer to the nearest cent.) Mathematical Financial $ 250,000 Machining costs Setup costs 100,000 $ 58,500 58,500 64,000 32,000 Inspection costs Total overhead costs $ 222,500 $ 340,500 Divide by number of units 25,000 50,000 8.90 $ 6.81 Manufacturing overhead cost per unit Requirement 2. Compute the manufacturing cost per unit for each product. Determine the formula to calculate the direct costs per unit. Direct cost of product + Units produced of product Direct cost per unit Now compute the manufacturing cost per unit for each product. Mathematical Financial $ 2.50 $ 2.50 Direct materials per unit Direct labor per unit 1.00 1.00 Manufacturing overhead per unit 8.90 6.81 12.40 $ 10.31 Manufacturing cost per unit Requirement 3. How might Potvin's managers use the new cost information from its activity-based costing system to better manage its business? (Select all that apply.) A. Managers can use this information to improve advertising campaigns and their public image. B. Managers can use this information for design decisions, and to plan and manage activities. C. Managers can use this information for pricing and product-mix decisions, and for cost reduction and process-improvement decisions. D. Managers can use this information to devise employee compensation packages