Fox hunting manufactures two products: jackets and hats. It produces 50,000

jackets and 20,000 hats per year. Information for overhead costs for the two products

are given below. It has identified three activities, setups, ordering parts and

machining. Estimated overhead costs are $ 200,000, $ 300,000 and $ 600,000

respectively. Cost drivers are no. of setups, no. of parts and no. of machine hours

respectively. During the year, jackets used 500 setups, 60,000 parts and 12,000

machine hours. Hats used 1,500 setups, 40,000 parts and 6,000 machine hours. Direct

Material for Jacket is $ 10 and Direct material for hats is $ 20. Direct labor for jackets

as well as hats is $ 15 per unit. Explain the difference in cost per unit of Jackets and

Hats. Do not write the numbers in words and call it explanation (4 marks ( 2*2

reasons and explanation))