Hakara Company has been using direct labor costs as the basis for assigning overhead to its many products. Under this allocation system product A has been assigned overhead of $24.08 per unit while product B has been assigned $11.37 per unit. Management feels that an ABC system will provide a more accurate allocation of the overhead costs and has collected the following cost pool and cost driver information:

Cost Pools	Activity Costs			Cost Driver	Driver Consumption
Machine setup		$ 396,000		Setup hours	4,000
Materials handling		120,000		Pounds of materials	12,000
Electric power		38,000		Kilowatt-hours	38,000

The following cost information pertains to the production of A and B, just two of its many products:

	A			B
Number of units produced		5,000			10,000
Direct materials cost	$	25,000		$	34,000
Direct labor cost	$	33,000		$	28,000
Number of setup hours		100			100
Pounds of materials used		2,000			1,000
Kilowatt-hours		2,000			2,000

1. Use activity-based costing to determine a unit cost for each product. (Round your final answers to 2 decimal places.) 2. Comment on managements belief that the ABC system will generate an overhead allocation that is more accurate than the volume-based system currently in use.