Eric Parker has been studying his departments profitability reports for the past six months. He has just completed a managerial accounting course and is beginning to question the companys approach to allocating overhead to products based on machine hours. The current department overhead budget of $883,585 is based on 39,500 machine hours. In an initial analysis of overhead costs, Eric has identified the following activity cost pools.

Cost Pool		Expected Cost				Expected Activities
Product assembly			$	337,725		39,500	Machine hours
Machine setup and calibration				289,800		2,100	setups
Product inspection				129,560		1,580	batches
Raw materials storage				126,500		506,000	pounds
			$	883,585

Eric Parker is taking the next step in his exploration of activity-based costing and wants to examine the overhead costs that would be allocated to two of the departments four products. He has gathered the following budget information about each product.

Driver Usage		Component 3F5			Component T76
Machine hours		1,000			10,000
Setups		45			21
Batches		15			10
Pounds of raw materials		10,000			10,000

Eric Parker found that the budget included production of 460 units of Component 3F5 and 4,600 units of Component T76. (a) Calculate the overhead cost per unit of Component 3F5 and Component T76 under traditional costing using machine hours as the overhead application base. (Round overhead rates to 2 decimal places, e.g. 5.27 and round final answers to 2 decimal places, e.g. 52.75.)

		Component 3F5		Component T76
Overhead cost per unit		$		$

(b) Calculate the overhead cost per unit of Component 3F5 and Component T76 underactivity-based costing. (Round overhead rates to 2 decimal places, e.g. 5.27 and round final answers to 2 decimal places, e.g. 52.75.)

		Component 3F5		Component T76
Overhead per unit		$		$