nting I & II (ACCT 221 &ACCT 222 XLS (LO 2). AP Schultz Electromics manufactures for $1,300. The production two ultra high-definition television models the Royale which sells for $1,600, and a new model,the Majestic,which sells cost computed per unit under traditional costing for each model in 2017 was as follows Traditional Costing $ 700 $420 120 100 Manufacturing overhead ($38 per DLH) 228 190 S1,048 710 Direct labor ($20 per hour) Total per unit cost In 2017, Schultz manufactured 25,000 units of the Royale and 10,000 units of the Majestic. The overhead rate of $38 per direct labor hour was determined by dividing total expected manufacturing overhead of $7,600,000 by the total direct labor hours (200,000) for the two models. Under traditional costing, the gross profit on the models was Royale $552 ($1,600- $1,048) and Majestic $590 ($1,300- $710). Because of this difference, management is considering phasing out the Royale model and increasing the production of the Majestic model. Before finalizing its decision, management asks Schultz's controller to prepare an analysis using activity-based costing (ABC). The controller accumulates the following information about overhead for the year ended December 31, 2017 Expected Activity-Based Estimated Activity Overhead Use of Cost Drivers h All Rights Reserved. A Division of 11:59 AM