Ice Cool produces two different models of air conditioners. The activities, costs, and cost drivers associated with the production processes follow.

Process Activity Budgeted Cost Activity Cost Driver Budgeted Activity Usage Assembly Machining $ 310,400 Machine hours (MH) 7,600 Setups 24,000 Setups 240 $ 334,400 Finishing Inspecting $ 224,000 Inspections 880 Support Purchasing $ 132,000 Purchase orders 480 Additional production information concerning its two models follows. Units and Activities Model X Model Z Units produced 1,800 3,600 Machine hours 2,200 5,400 Setups 80 160 Inspections 520 360 Purchase orders 320 160 Per Unit Model X Model Z Selling price per unit $ 410 $ 390 Direct materials cost per unit 160 105 Direct labor cost per unit 125 150

1. Compute the activity rate for each activity using activity-based costing.

2. Using activity-based costing, compute the overhead cost per unit for each model. 3. Compute the total product cost per unit for each model. 4. For each model, compute the gross profit per unit (selling price per unit minus product cost per unit).