Exercise 4-9 Using ABC to assess prices LO P3 Way Cool produces two different models of air conditioners. The company produces the mechanical systems in thelr components department. The mechanical systems are combined with the housing assembly in Its fintshing department The activitles, costs, and drivers associated with these two manufacturing processes and the production support process follow Process Activity Overhead Cost Driver Quantity $ $18,750 379,819 336,600 Components Changeover Machining Setups Number of batches 830 Machine hours Number of setups 8,030 180 $1,235,169 welding Inspecting Rework 344,100 welding hours Number of inspections 6,200 Finishing 301,950 915 140 37,8e0 Rework orders 683,850 176,7ee Purchasing Providing space Providing utilities Purchase orders Nueber of units Nunber of units 465 Support 6,900 31.100 99,310 6,900 s07,110 Additional production Information concerning Its two product lines follows. Model 145 Model 212 Units produced welding hours Batches 2,3ee 4,6ee 2,200 4,e00 415 415 Number of inspections Machine hours 5es 410 2,75e 5,28e 9e Setups 9e Rework orders se Purchase orders 31e 155 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 $240 for Model 145 and $120 for Model 212 3. If the market price for Model 145 ts $689 28 and the market price for Model 212 Is $380.01, 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 decimals places,) Model 145 Model 212 Activity Activity driver incurred Expected Costs Expected Activity Overhead assigned Activity driver incurred Activity Rate Overhead assigned Components Changeover 830 Number of batches 518.750 8.030 Machine hours Machining 370810 Setups 180 Setups 330.000 Firishing Welding 6.200 Welding hours 344.100 015 Inspections Inspecting 301,050 Reeork 37800 140 Rework orders Support 176.700 Purchasings 465 Purchase orders Providng seace and uses 6.000 Unts 130 410 Total everhead cost Total units produced Ovehead cost per unt Required 2> Requlred: 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 materlals costs per unit are $240 for Model 145 and $120 for Model 212 3. If the market price for Model 145 Is $689.28 and the market price for Model 212 is $380.01, 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 $240 for Model 145 and $120 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
