HiTech Products manufactures three types of CD players: Cheap, Econo, and Deluxe. HiTech uses an activity-based product costing system. The company has identified five activities. Each activity, its cost and related activity driver is identified below:ActivityCostActivity DriverMaterial handling$ 225,000Number of partsMaterial insertion$2,475,000Number of partsAutomated machinery$ 840,000Machine hoursFinishing$ 170,000Labour hoursPackaging$ 170,000Orders shippedTotal manufacturing cost$ 3,880,000

The following information pertains to each product line of CD players:CheapEconoDeluxeUnits to be produced10,0005,0002,000Orders to be shipped1,000500200Number of parts per unit101525Machine hours per unit135Labour hours per unit222

Under an activity-based product costing system, what is the per unit cost of Deluxe?

Select one:

a.$141

b.$946.66

c.$440

d.$272

e.$164

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Which of the following would appear on the debit side of the overhead account?

Select one:

Actual overhead cost incurred in the period

Overhead applied (charged) to production

Overapplied overhead for the period

Actual overhead cost incurred in the period AND overapplied overhead for the period

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Conventional product costing systems used where product diversity has increased, cost structures have become more overhead-intensive and a higher proportion of overhead costs are fixed costs can result in:

Select one:

overstating the cost of high-volume, relatively simple product lines and understating the costs of low-volume, speciality product lines.

understating the cost of high-volume, relatively simple product lines and overstating the costs of low-volume, speciality product lines.

understating the cost of both high-volume and low-volume product lines.

overstating the cost of both high-volume and low-volume product lines.