Manufacturing overhead is assigned to products on the basis of direct labor-hours. For the current year, the company has estimated that it will incur $6,490,425 in manufacturing overhead cost and produce 19,000 units of the deluxe model and 126,000 units of the regular model. The deluxe model requires 0.8 hours of direct labor time per unit, and the regular model requires 0.4 hour. Material and labor costs per unit are as follows: Direct materials Direct labor Model Deluxe Regular $ 149 $ 113 $ 15 $ 12 Required: 1-a. Using direct labor-hours as the base for assigning manufacturing overhead cost to products, compute the predetermined overhead rate. 1-b. Using the predetermined overhead rate computed in 1-a above and other data from the problem, determine the unit product cost of each model. 2. Management is considering using activity-based absorption costing to apply manufacturing overhead cost to products. The activity- based system would have the following four activity cost pools: Activity Cost Pool Purchasing Processing Scrap/rework Shipping Activity Measure Purchase orders issued Machine-hours Scrap/rework orders issued Number of shipments Estimated Overhead Cost $ 250, 800 4,335,000 770, 625 1,134,000 $6,490, 425 Activity Measure Purchase orders issued Machine-hours Scrap/rework orders issued Number of shipments Expected Activity Deluxe Regular Total 380 760 1,140 20,400 30,600 51,000 625 500 1, 125 5,040 7,560 12,600 Required: 1-a. Using direct labor-hours as the base for assigning manufacturing overhead cost to products, compute the predetermined overhead rate. 1-b. Using the predetermined overhead rate computed in 1-a above and other data from the problem, determine the unit product cost of each model. 2. Management is considering using activity-based absorption costing to apply manufacturing overhead cost to products. The activity- based system would have the following four activity cost pools: Activity Cost Pool Purchasing Processing Scrap/rework Shipping Activity Measure Purchase orders issued Machine-hours Scrap/rework orders issued Number of shipments Estimated Overhead Cost $ 250,800 4,335,000 770,625 1,134,000 $6,490,425 Activity Measure Purchase orders issued Machine-hours Scrap/rework orders issued Number of shipments Expected Activity Deluxe Regular Total 380 760 1,140 20,400 30, 600 51,000 625 500 1,125 5,040 7,560 12,600 Determine the predetermined overhead rate for each of the four activity cost pools. 3. Using the predetermined overhead rates you computed in part (2), do the following: a. Compute the total amount of manufacturing overhead cost that would be applied to each model using the activity-based absorption costing system. After these totals have been computed, determine the amount of manufacturing overhead cost per unit of each model b. Compute the unit product cost of each model (including direct materials, direct labor, and manufacturing overhead). Manufacturing overhead is assigned to products on the basis of direct labor-hours. For the current year, the company has estimated that it will incur $6,490,425 in manufacturing overhead cost and produce 19,000 units of the deluxe model and 126,000 units of the regular model. The deluxe model requires 0.8 hours of direct labor time per unit, and the regular model requires 0.4 hour. Material and labor costs per unit are as follows: Direct materials Direct labor Model Deluxe Regular $ 149 $ 113 $ 15 $ 12 Required: 1-a. Using direct labor-hours as the base for assigning manufacturing overhead cost to products, compute the predetermined overhead rate. 1-b. Using the predetermined overhead rate computed in 1-a above and other data from the problem, determine the unit product cost of each model. 2. Management is considering using activity-based absorption costing to apply manufacturing overhead cost to products. The activity- based system would have the following four activity cost pools: Activity Cost Pool Purchasing Processing Scrap/rework Shipping Activity Measure Purchase orders issued Machine-hours Scrap/rework orders issued Number of shipments Estimated Overhead Cost $ 250, 800 4,335,000 770, 625 1,134,000 $6,490, 425 Activity Measure Purchase orders issued Machine-hours Scrap/rework orders issued Number of shipments Expected Activity Deluxe Regular Total 380 760 1,140 20,400 30,600 51,000 625 500 1, 125 5,040 7,560 12,600 Required: 1-a. Using direct labor-hours as the base for assigning manufacturing overhead cost to products, compute the predetermined overhead rate. 1-b. Using the predetermined overhead rate computed in 1-a above and other data from the problem, determine the unit product cost of each model. 2. Management is considering using activity-based absorption costing to apply manufacturing overhead cost to products. The activity- based system would have the following four activity cost pools: Activity Cost Pool Purchasing Processing Scrap/rework Shipping Activity Measure Purchase orders issued Machine-hours Scrap/rework orders issued Number of shipments Estimated Overhead Cost $ 250,800 4,335,000 770,625 1,134,000 $6,490,425 Activity Measure Purchase orders issued Machine-hours Scrap/rework orders issued Number of shipments Expected Activity Deluxe Regular Total 380 760 1,140 20,400 30, 600 51,000 625 500 1,125 5,040 7,560 12,600 Determine the predetermined overhead rate for each of the four activity cost pools. 3. Using the predetermined overhead rates you computed in part (2), do the following: a. Compute the total amount of manufacturing overhead cost that would be applied to each model using the activity-based absorption costing system. After these totals have been computed, determine the amount of manufacturing overhead cost per unit of each model b. Compute the unit product cost of each model (including direct materials, direct labor, and manufacturing overhead)