Exercise 04-9 Using departmental overhead rates to assess prices LO P2 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 890 8, 540 120 Rook Finishing Welding Inspecting Rework Overhead Cost Driver $ 460, eee Number of batches 309, eoe Machine hours 234, eee Number of setups $1,003,000 $ 192,000 Welding hours 221,000 Number of inspections 62,500 Rework orders $ 475,500 $ 135,000 Purchase orders 38,500 Number of units 62,000 Number of units $ 235,500 4,000 930 220 Support Purchasing Providing space Providing utilities 477 4,950 4,950 Additional production Information concerning its two product lines follows. Model 212 3,050 3,200 445 Units produced Welding hours Batches Number of inspections Machine hours Setups Rework orders Purchase orders Model 145 1,900 800 445 520 3,250 60 160 318 410 5,290 60 60 159 Required: 1. Determine departmental overhead rates and compute the overhead cost per unit for each product line. Base your overhead assignment for the components department on machine hours. Use welding hours to assign overhead costs to the finishing department. Assign costs to the support department based on number of purchase orders. 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $230 for Model 145 and $140 for Model 212 3. If the market price for Model 145 is $2.000 and the market price for Model 212 is $260, 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 departmental overhead rates and compute the overhead cost per unit for each product line. Base your overhead assignment for the components department on machine hours. Use welding hours to assign overhead costs to the finishing department Assign costs to the support department based on number of purchase orders. (Round your intermediate calculations and per unit cost answers to 2 decimal places.) Show less Required 1 Required 2 Required 3 Determine departmental overhead rates and compute the overhead cost per unit for each product line. Base you assignment for the components department on machine hours. Use welding hours to assign overhead costs to ti department. Assign costs to the support department based on number of purchase orders. (Round your intermec calculations and per unit cost answers to 2 decimal places.) Components department Finishing department Support department Model 145 Activity Driver Departmental OH Rate Total Overhead Cost Components Finishing Support Activity Departmental Model 212 Total Overhead Cost Model 145 Activity Driver Departmental OH Rate Total Overhead Cost Components Finishing Support Model 212 Activity Driver Departmental OH Rate Total Overhead Cost Components Finishing Support Required 1 Required 2 > Required: Required 2 1. Determine departmentai Overhead rates and compute the overhead cost per unit for each product line. Base your overhead assignment for the corponents department on machine hours. Use welding hours to assign overhead costs to the finishing department. Assign costs to the support department based on number of purchase orders. 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $230 for Model 145 and $140 for Model 212 3. If the market price for Model 145 is $2,000 and the market price for Model 212 is $260, 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 $230 for Model 145 and $140 for Model 212. (Round your intermediate calculations and cost per unit answers to 2 decimal places.) Model 145 Model 212 Materials and Labor per unit Overhead cost per unit Total cost per unit Required: 1. Determine departmental overhead rates and compute the overhead cost per unit for each product line. Base your overhead assignment for the components department on machine hours. Use welding hours to assign overhead costs to the finishing department. Assign costs to the support department based on number of purchase orders. 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $230 for Model 145 and $140 for Model 212. 3. If the market price for Model 145 is $2,000 and the market price for Model 212 is $260, determine the profit or loss per unit for eac model. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 If the market price for Model 145 is $2,000 and the market price for Model 212 is $260, determine the profit or loss per unit for each model. (Loss amounts should be indicated with a minus sign. Round your intermediate calculations and final answers to 2 decimal places.) Model 145 Model 212 Market price per unit Cost per unit Profit (loss) per unit
