O$$Leary Corporation manufactures two products, telescoping arms and grip clamps. The corporation recently developed grip clamps as an attempt to enter a market closely related to that of telescoping arms. Of the two products, the grip clamps require two and a half hours of direct labour time per unit to manufacture, compared to one hour of direct labour time for a telescoping arm. The grip clamps are produced on an automated production line.

On the basis of direct labour hours, overhead is currently assigned to the products. The corporation estimated it would incur $$364,000$ in manufacturing overhead costs and produce $4,900$ units of grip clamps and $22,100$ units of telescoping arms in the present year. Unit costs for materials and direct labour are in Table $1.$

Perform the following tasks:

Compute the predetermined overhead rate under the current method of allocation and determine the unit product cost of each product for the current year.

The company$$s overhead costs can be attributed to four major activities. These activities and the amount of overhead cost attributable to each for the current year are given in Table $2.$

Determine the unit product cost of each product for the current year using the data in the tables and an activity$-$based costing approach.

Table $1$ shows unit costs for materials and direct labour for both telescoping arms and grip clamps. Direct materials for telescoping arms is $$9$ while it$$s $$20$ for grip clamps. The direct labour for telescoping arms is $$7$ while it$$s $$15$ for grip clamps. Table $2$ shows the activity cost pool, estimated overhead along with the expected activity of both telescoping arms and grip clamps, listing their totals. Machine setups required has an estimated overhead cost of $$161,00.$ Purchase orders issued has an estimated overhead cost of $$32,000.$ Machine hours required has an estimated overhead cost of $$81,000.$ Maintenance requests issued has an estimated overhead cost of $$90,000.$ The total comes to $$364,000$ in estimated overhead costs. For telescoping arms, it is expected that there will be $800$ machine setups required and $700$ for grip clamps, coming to $1500$ total. For telescoping arms, it is expected to have $200$ purchase orders issued and $150$ for grip clamps, coming to $350$ total. For telescoping arms, it is expected that there will $3900$ machine hours required and $7000$ for grip clamps, coming to a total of $10,900.$ The maintenance requests issued are expected to be $310$ for telescoping arms and $510$ for grip clamps, coming to a total of $820.$