Exercise 17-8 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 their 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 Components Changeover Activity Overhead Cost Driver Quantity 830 8,280 60 S 460,000 Number of batches Machining Setups 308,000 Machine hours 34,000 Number of setups $1,002,000 FinishingWelding Inspecting Rework 186,000 Welding hours 225,000 Number of inspections 4,100 855 240 60,500 Rework orders 471,500 SupportPurchasing Providing space Providing utilities $ 135,000 31,500 63,000 Purchase orders Number of units Number of units 4,810 4,810 $ 229,500