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Puget World, Incorporated, manufactures two models of television sets, the N800XL model and the N500 model. Data regarding the two products follow: Additional information about

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Puget World, Incorporated, manufactures two models of television sets, the N800XL model and the N500 model. Data regarding the two products follow: Additional information about the company follows: a. Model N800XL requires $65 in direct materials per unit, and Model N500 requires $25. b. The direct labor wage rate is $23 per hour. c. The company has always used direct labor-hours as the base for applying manufacturing overhead cost to products. d. Model N 800XL is more complex to manufacture than Model N 500 and requires the use of special equlpment. Consequently, the company is considering the use of activity-based costing to assign manufacturing overhead cost to products. Three activity cost pools have been identified as follows: Required: 1. Assume that the company continues to use direct labor-hours as the base for applying overhead cost to products. a. Compute the predetermined overhead rate. b. Compute the unit product cost of each model

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