Husky, Inc. manufactures two component parts for the television industry:

Hus1: Annual production and sales of 50,000 units at a selling price of $52.50per unit.

Sky2: Annual production and sales of 25,000 units at a selling price of $72 per unit.

Husky inludes all R&D and design costs in engineering costs. Assume that Husky has no marketing, distribution, or customer-service costs.

The direct and overhead costs incurred by Husky on Hus1 and Sky2 are described as follows: Hus1 Sky2* Total* Direct materials costs (variable Direct manufacturing labour costs (variable Direct machining costs (fixed Manufacturing overhead costs:' $1,020,000 $720,000 360,000240,000 180,000120,000 $1,740,000 600,000 300,000 Machine setup costs* lesting costs Engineering costs 112,500 600,000 480,000 Manufacturing overhead costs 1,192,500 $3,832,500 Total costs Husky's management identifies the following activity cost pools, cost drivers for each activity,| and the costs per unit of cost driver for each overhead cost pool: Activity* Description Cost Driver Cost per Unit of Cost Driver Setup* Testinge Engineering Preparing machine to manufacture a new Setup-hours batch of products*e Testing components and final product Testing-hours (each unit is tested individually)e Designing products and processes and ensuring their smooth functioning 30 per setup-hour 2.40 per testing- houre Complexity of product costs assigned to products and process by special study