Exercise 17-9 Using ABC to assess prices LO P3 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 Activity Changeover Machining Setups Driver Number of batches Machine hours Number of setups Quantity 899 6,6ee 129 Finishing Welding Inspecting Rework Overhead Cost $ 580,cee 279,699 225,eee $1,684,00 $ 129,99 210,eee 75,eee $ 465,300 $ 135,000 32,000 65,000 $ 232,888 Helding hours Number of inspections Rework orders 3,600 799 390 Support Purchasing Providing space Providing utilities Purchase orders Number of units Number of units 459 5, ece 5,600 Additional production information concerning its two product lines follows. Model 212 3,500 Model 145 1,500 899 499 400 1,220 69 169 339 Units produced Welding hours Batches Number of inspections Machine hours Set ups Rework orders Purchase orders 499 339 69 149 159 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 $250 for Model 145 and $180 for Model 212. 3. If the market price for Model 145 is $820 and the market price for Model 212 is $480, 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 Using ABC, compute the overhead cost per unit for each product line. (Round your final answers to 2 decimal places.) Model 145 Activity Overhead driver assigned incurred Expected Costs Model 212 Activity Overhead driver incurred assigned Activity Expected Activity Activity Rate Components $ 500,000 800 Number of 279,000 225,000 batches 6,000 Machine hours 120 Setups Changeover Machining Setups Finishing Welding Inspecting Rework Support Purchasing Providing space and utilities 180,300 210,000 75,000 3,000 Welding hours 700 Inspections 300 Rework orders 135,000 450 Purchase orders 97,000 5,000 Units Total overhead cost Total units produced Overhead cost per unit Required Required 2 > 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 $250 for Model 145 and $180 for Model 2i2. (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 Purchase order's 288 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 $250 for Model 145 and $180 for Model 212. 3. If the market price for Model 145 is $820 and the market price for Model 212 is $480. 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 If the market price for Model 145 is $820 and the market price for Model 212 is $480, 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
