Part one, Trump & Trudeau Inc. (T&T) produce surf boards models, Fired, which has been produced for many years and sells for $925, and the Dude, a new model, which sells for $1,360. Based on the following income statement for 2018, the CFO at T&T has decided to concentrate the marketing resources on the Dude model and to begin to phase out the Fired model.

boa rd 2 Cost Per Unit of Surf Dude Direct Material $3.50 Direct Labour Production Overhead Corporate Overhead Cost of Game Board 5: Units of the Cost Driver Activity Centres and Cost Drivers Activity Costs Dude Fired Total Laminating (number of boards) $ 800,000 400,000 1,200,000 1,600,000 Shipments (number of shipments) 775,000 4,800 15,200 20,000 Quality Control ( number of inspections) 1,280,000 21,000 59,000 80,000 Purchase Orders (number of orders) 800,000 110,000 50,000 160,000 Machine Power (machine hours) 150,000 20,000 180,000 200,000 Machine set-ups (number of set ups) 1,000,000 4,000 6,000 10,000 Total Traceable costs $ 4,805,000the Fire Trump & Trudeau Inc. Income statement March 31, 2019 Dude Fired Total Sales $ 5,576,000 $ 20,373,125 $ 25,949,125 Cost of Goods Sold 4,070,480 15,279,844 $ 19,350,324 Gross Margin 1,505,520 5,093,281 $ 6,598,801 Selling and Admininstrative Expen: 947,920 3,055,969 $ 4,003,889 Net profit $ 557,600 $ 2,037,313 2,594,913 Units produced and sold 4,100 22,025 Net profit per unit sold $136.00 $92.50 The standard unit costs for the Dude and Fired models are as follows: Dude Fired Direct Materials $700 $300 Direct Labour: Dude (3.5 hrs x $20/hr.) 70 Fired (1.5 hrs. x $20/hr.) 30 Machine Usage: Dude (4 hrs. x $25/hr.) 100 Fired (8 hrs. x $25/hr.) 200 Manufacurting Overhead 150 225 Standard Cost $1,020 $755