Exercise 04-11 Using ABC to assess prices LO P3 Way Cool produces two different models of air conditioners. The company produces the mechanical systems in its components department. The mechanical systems are combined with the housing assembly in its finishing department. The activities, costs, and drivers associated with these two manufacturing processes and the production support process follow. Process Activity Components Changeover Machining Setups Quantity 910 7,700 120 Finishing Welding Inspecting Rework Overhead Cost Driver $ 514,150 Number of batches 351,120 Machine hours 218,400 Number of setups $1,083,670 $ 334,188 Welding hours 289,000 Number of inspections 57,000 Rework orders $ 680, 180 $ 194,545 Purchase orders 30, 380 Number of units 59,948 Number of units $ 284,785 4,900 850 2ee Support 533 Purchasing Providing space Providing utilities 4,800 4,800 Additional production information concerning its two product lines follows. Units produced Welding hours Batches Number of inspections Machine hours Setups Rework orders Purchase orders Model 145 1,600 1,600 455 480 2,350 60 160 355 Model 212 3,200 3,300 455 370 5,350 60 40 178 Required: 1. Using ABC, compute the overhead cost per unit for each product line. 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $190 for Model 145 and $116 for Model 212. 3. If the market price for Model 145 is $784.97 and the market price for Model 212 is $459.40, determine the profit or loss per unit for each model Complete this question by entering your answers in the tabs below. Required t equired 2 Required 3 Using ABC, compute the overhead cost per unit for each product line. (Round your final answers to 2 decimal places.) Activity Expected Costs Expected Active Activity Hate Component Chave 514150 351,120 218,400 910 70 Machine 10 Date 13410 299,000 57000 Purchaung 533 Purchase orders 4300 units 3000 Reg 2 > Required: 1. Using ABC, compute the overhead cost per unit for each product line. 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $190 for Model 145 and $116 for Model 212 3. If the market price for Model 145 is $784.97 and the market price for Model 212 is $459.40, determine the profit or loss per unit for each model. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $190 for Model 145 and 5116 for Model 212. (Round your final answers to 2 decimal places.) Model 145 Model 212 Materials and Labor per unit Overhead cost per unit Total cost per unit Complete this question by entering your answers in the tabs below. Required 3 Required 3 Required 1 Required 2 If the market price for Model 145 is $784.97 and the market price for Model 212 is $459.40, determine the profit or loss per unit for each model. (Round your final answers to 2 decimal places.) Model 145 Model 212 Price per unit Cost per unit Profit loss) per unit
