Problem Two - Activity-Based Costing Systems (20 point value) Cranston Company produces a variety of bicycles. One of its plants produces two bicycles: a mountain model and a road model. At the beginning of the year, the following data were prepared for this plant: Mountain Road Quantity 220,000 125,000 Selling Price $1,150 $990 Unit Prime Cost $ 400 $ 450 In addition, the following information was provided so that overhead costs could be assigned to each product: Activity Name Activity Driver Activity Cost Mountain Machining Machine hours $20,000,000 250,000 Engineering Engineering hours $ 8,000,000 75,000 Packing Packing orders $ 4,500,000 45,000 Raymond Company uses activity-based costing to calculate product costs. Road 250,000 50,000 115,000 A. Required: Calculate the per unit product cost for a mountain bike. Calculate the per unit product cost for a road bike. Assume Cranston Company decides to use a markup and adds 30% to the cost of a mountain bike and 40% to the cost of a road bike obtain the selling prices. Calculate the selling prices under this scenario for a mountain bike and a road bike