Horor Home Run ABC Saver ABC Home Run Practice! Sarver Company manufactures 4,000 units of Product A and 20,000 units of Product B each year. The company total estimated overhead costs are $900,000 and total estimated labor hours are 50,000 hours. The company currently uses direct labor hours to assign overhead cost to B products. Product A requires 2.5 DLH and Product B requires 2.0 DLH to produce. Required: Part (1) Using Traditional Costing method; (1a) Calculate predetermined overhead rate using direct labor hours (traditional costing systems). (1b) Calculate unit product cost of product A and product B using predetermined overhead rate. producto Prode. Direct material Direct labor Manufacturing overhead Total unit product cost 17.60 14.00 (1c) Calculate unit product price assuming selling price is determined by 50% mark-up on costs. Saver ABC Home Run Practice! ABC Required: Part (11) Using ABC method; Management estimated the following additional information to conduct ABC analysis: A Cost Pools (Activity) Machine setup cost (BLA) Quality inspection costs (PLA) Product order costs (PLA) Machine-related costs (ULA) Material receipts costs (BLA) Total overhead costs Traceable Cost $ 255,000 160,000 81,000 314,000 90,000 900,000 Activity Machine se tups Quality inspections Production orders Machine-hours worked Material receipts Total 5,000 8,000 600 40,000 750 Product A 3,000 5,000 200 12,000 150 Product B 2,000 3,000 400 28,000 600 Saver ABC Home Run Practice! ABC Required: Part (II) Using ABC method and above additional information: (2a) Calculate manufacturing overhead costs for each product. A (2b) Calculate unit product cost for each product using ABC rate. Product A 36.00 17.50 Direct material Direct labor Manufacturing overhead Total unit product cost Product B $ 30.00 14.00 ? (2c) Calculate unit product price assuming selling price is determined by 50% mark-up on costs. Part (III) Explain why there are difference in unit product costs under traditional costing system and under activity based costing