Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows: Direct materials cost per unit Direct labor cost per unit Expected production per month Work $ 63 Home $ 41 22 358 39 568 720 unita 450 units ces Sales price per unit Harbour has monthly overhead of $200,965, which is divided into the following activity pools: Setup costs Quality control Maintenance Total $ 88,290 55,675 57,000 $ 200,965 The company also has compiled the following information about the chosen cost drivers: Number of setups Number of inspections Number of machine hours Home 42 330 1,300 Work 67 325 Total 109 1,700 655 3,000 Required: 1. Suppose Harbour uses a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. 2. Calculate the production cost per unit for each of Harbour's products under a traditional costing system. 3. Calculate Harbour's gross margin per unit for,each product under the traditional costing system. 4. Select the appropriate cost driver for each activity pool and calculate the activity rates if Harbour wanted to implement an ABC system. 5. Assuming an ABC system, assign overhead costs to each product based on activity demands. 6. Calculate the production cost per unit for each of Harbour's products in an ABC system. 7. Calculate Harbour's gross margin per unit for each product under an ABC system. 8. Compare the gross margin of each product under the traditional system and ABC.