Deoro Company has identified the following overhead activities, costs, and activity drivers for the coming year:

Activity	Expected Cost	Activity Driver	Activity Capacity
Setting up equipment	$520,650	Number of setups	650
Ordering costs	333,000	Number of orders	18,500
Machine costs	708,900	Machine hours	41,700
Receiving	401,700	Receiving hours	10,300

Deoro produces two models of dishwashers with the following expected prime costs and activity demands:

	Model A	Model B
Direct materials	$573,000	$840,000
Direct labor	485,000	451,000
Units completed	15,100	8,400
Direct labor hours	5,400	2,000
Number of setups	430	220
Number of orders	6,100	12,400
Machine hours	24,000	17,700
Receiving hours	3,100	7,200

The company's normal activity is 7,400 direct labor hours.

Required:

1. Determine the unit cost for each model using direct labor hours to apply overhead. Round intermediate calculations and final answers to nearest cent.

	Unit Cost
Model A	$fill in the blank 1
Model B	$fill in the blank 2

2. Determine the unit cost for each model using the four activity drivers. Round your answers to nearest cent.

	Unit Cost
Model A	$fill in the blank 3
Model B	$fill in the blank 4

3. Which method produces the more accurate cost assignment?

Direct labor hoursFour activity drivers

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