EyeGuard Equipment Incorporated (EEI) manufactures protective eyewear for use in commercial and home applications. The product is also used by hunters, home woodworking hobbyists, and in other applications. The firm has two main product linesthe highest-quality product is called Safe-T, and a low-cost, value version is called Safe-V. Information on the factory conversion costs for EEI is as follows:

Factory CostsSalaries$ 852,000Supplies152,000Factory expense552,000Total$ 1,556,000

EEI uses ABC to determine the unit costs of its products. The firm uses resource consumption cost drivers based on rough estimates of the amount that each activity consumes, as shown below. EEI has four activities: job setup, assembly, inspecting and finishing, and packaging.

SetupAssemblyInspecting and FinishingPackagingTotalSalaries15%55%20%10%100%Supplies206020 100Factory expense 8020 100

The activity cost drivers for the two products are summarized below.

ActivitiesActivity DriverSetupBatchAssemblyUnitsInspect and finishingFinishing hoursPackagingPacking hours

Safe-VSafe-TBatches270620Units62,00074,000Finishing hours, per unit0.200.30Packaging hours, per unit0.100.15Materials per unit$ 3.50$ 6.00

Required:

1. Determine the amount of the cost pool for each of the four activities.

2. Determine the activity-driver rates for assigning factory costs to the two products.

3. Determine the activity-based unit cost for each of the products.