produces two different models of air conditioners. The company produces the mechanical systems in its components department. The mechanical systems are combined with the housing assembly in its finishing department. The activities, costs, and drivers associated with these two manufacturing processes and the production support process follow.

Process	Activity	Overhead Cost				Driver	Quantity
Components	Changeover		$	456,000		Number of batches	730
	Machining			307,000		Machine hours	7,710
	Setups			225,000		Number of setups	180
			$	988,000
Finishing	Welding		$	194,000		Welding hours	5,200
	Inspecting			232,000		Number of inspections	855
	Rework			62,500		Rework orders	250
			$	488,500
Support	Purchasing		$	145,000		Purchase orders	561
	Providing space			37,500		Number of units	4,690
	Providing utilities			65,000		Number of units	4,690
			$	247,500

Additional production information concerning its two product lines follows.

	Model 145			Model 212
Units produced		1,600			3,090
Welding hours		1,400			3,800
Batches		365			365
Number of inspections		495			360
Machine hours		2,450			5,260
Setups		90			90
Rework orders		160			90
Purchase orders		374			187

Required: 1. Determine departmental overhead rates and compute the overhead cost per unit for each product line. Base your overhead assignment for the components department on machine hours. Use welding hours to assign overhead costs to the finishing department. Assign costs to the support department based on number of purchase orders. 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $290 for Model 145 and $110 for Model 212. 3. If the market price for Model 145 is $2,000 and the market price for Model 212 is $320, determine the profit or loss per unit for each model.