Question # 12.6 Linacre Co operates an activity base costing system and has forecast the following the following information for next year. Cost pool Costs Cost Driver Number of drivers Production setup 105,000 setups 300 Product testing 300,000 Test 1,500 Component supply and storage 25,000 Component order 500 Customer orders and delivery112,500 Customer orders 1,000 General fixed overheads such as lighting and heating, which cannot be linked to any specific activity, are expected to be $900,000 and these overheads are absorbed on a direct labour hour's basis. Total direct labour hours for next year are expected to be 300,000 hours. Linacre Co expects orders for Product ZT3 next year to be 100 orders of 60 units per order and 60 orders of 50 units per order. The company holds no inventory of product ZT3 and will need to produce the order requirement in production runs of 900 units. One order for components is placed prior to each production run, Four tests are made during each production run to ensure that quantity standards are maintained. The following additional cost and profit information relates to product ZT3: Component cost: $1.00 per unit Direct labour 10 minutes per unit at $7.80 per hour Profit markup 40% of total unit cost Required: (a) Calculate the activity base recovery rate for each cost pool. (b) Calculate the total unit cost and selling price of product ZT3