National Inc. manufactures two models of CMD that can be used as cell phones, MPX, and digital camcorders.

Model	Annual Sales in Units
High F	11,300
Great P	17,300

National uses a volume-based costing system to apply factory overhead based on direct labor dollars. The unit prime costs of each product were as follows:

	High F			Great P
Direct materials	$	39.30		$	26.70
Direct labor	$	18.90		$	14.50

Budget factory overhead:
Engineering and Design	2,660	engineering hours	$	425,600
Quality Control	13,090	inspection hours		350,190
Machinery	33,970	machine hours		541,600
Miscellaneous Overhead	26,650	direct labor hours		132,650
Total			$	1,450,040

National's controller had been researching activity-based costing and decided to switch to it. A special study determined National's two products have the following budgeted activities:

	High F	Great P
Engineering and design hours	1,090	1,570
Quality control inspection hours	5,770	7,320
Machine hours	20,410	13,560
Labor hours	12,130	14,520

Using activity-based costing, applied quality control factory overhead for the Great P model per unit is: (Rounded to the nearest cent.)

Multiple Choice

• $14.52.

• $11.32.

• $4.18.

• $12.50.

• $42.51.