Dimple Inc. of Cebu Ltd. has decided to institute a pilot activity-based costing project in its five-person purchasing department. Annual departmental costs are P473,500. Because finding the best supplier takes the majority of effort in the department, most of the costs are allocated to this area.

Activity	Cost driver	Number of people	Total cost
Find best suppliers	Number of telephone calls	3	P300,000
Issue purchase orders	Number of purchase orders	1	100,000
Review receiving reports	Number of receiving reports	1	73,500

During the year, the purchasing department made 150,000 telephone calls, issued 10,000 purchase orders, and reviewed 7,000 receiving reports. Many purchase orders are received in a single shipment.

One product manufactured by Cebu Ltd. required the following purchasing department activities: 125 telephone calls, 60 purchase orders, and 15 receipts.

Required:

a. What amount of purchasing department cost should be assigned to the product?

b. What is the purchasing department cost per unit would be if 200 units of the product are manufactured during the year?