FireOut Inc. manufactures steel cylinders and nozzles for two models of fire extinguishers: (1) a home fire extinguisher and (2) a commercial fire extinguisher. The home model is a high-volume (50,000 units), half-litre cylinder that holds 2.5 kilograms of multi-purpose dry chemical at 480 PSI (pounds per square inch). The commercial model is a low-volume (9,728 units), two-litre cylinder that holds 10 kilograms of multi-purpose dry chemical at 390 PSI. Both products require 1.25 hours of direct labour for completion. Therefore, total annual direct labour hours are 74,660 or [1.25 hrs. (50,000 + 9,728)]. Estimated annual manufacturing overhead is $1,493,200. Thus, the predetermined overhead rate is $20.00 or ($1,493,200 74,660) per direct labour hour. The direct materials cost per unit is $18.64 for the home model and $26.66 for the commercial model. The direct labour cost is $20.20 per unit for both the home and commercial models.

The companys managers identified six activity cost pools and related cost drivers, and estimated overhead by cost pool as follows:

FireOut Inc, manufactures steel cylinders and nozzles for two models of fire extinguishers: (1) a home fire extinguisher and (2) a commercial fire extinguisher. The home model is a high-volume (50,000 units), half-litre cylinder that holds 2.5 kilograms of multi-purpose dry chemical at 480 PSI (pounds per square inch). The commercial model is a low-volume (9,728 units), two-litre cylinder that holds 10 kilograms of multi-purpose dry chemical at 390 PSI. Both products require 1.25 hours of direct labour for completion. Therefore, total annual direct labour hours are 74,660 or [1.25 hrs. x (50,000 + 9,728)]. Estimated annual manufacturing overhead is $1,493,200. Thus, the predetermined overhead rate is $20.00 or ($1,493,200 = 74,660) per direct labour hour. The direct materials cost per unit is $18.64 for the home model and $26.66 for the commercial model. The direct labour cost is $20.20 per unit for both the home and commercial models. The company's managers identified six activity cost pools and related cost drivers, and estimated overhead by cost pool as follows: Activity Cost Pools Cost Drivers Estimated Estimated Use Estimated Use Overhead of Cost Drivers of Drivers by Product Home Commercial $67,400 337,000 216,000 121,000 150,500 35,000 27,000 8,000 394,200 219,000 167,000 52,000 26,000 16,000 10,000 54,000 6,000 4,000 2,000 775,100 337,000 216,000 121,000 $1,493,200 Receiving Kilograms Forming Machine hours Assembling Number of parts Testing Number of tests Painting Litres Packing and shipping kilograms 52,000 X Your answer is incorrect. Under traditional product costing, calculate the total unit cost of each product. Prepare a simple comparative schedule of the individual costs by product. (Round answers to 2 decimal places, e.g. 15.25.) Products Manufacturing Costs Home Model Commercial Model Direct materials 18.92 27.08 Direct labour 19.60 19.60 x x Overhead 20 20 X Total unit cost 58.52 66.68 Your answer is partially correct. Under ABC, prepare a schedule showing the calculations of the activity-based overhead rates (per cost driver). (Round rate per cost driver to 2 decimal places, e.g. 15.25 and other answers to 0 decimal places e.g. 1525.) Est. MOH Est. Usage Cost Drivers Cost Pool Rate Receiving 67400 337000 0.20 per kilogram x X Forming 151200 36000 4.20 per machine hr. x Assembly 396000 220000 1.80 per part $ x Testing 54000 27000 2 per test $ X x X Painting 54600 7000 7.80 per litre Packing and shipping 775100 337000 2.30 per kilogram 1498300 x Your answer is incorrect. Calculate the total cost per unit for each product under ABC. (Round answers to 2 decimal places, e.g. 15.25.) Home Commercial Per unit cost 56.13 74.87