RCES Problem 4-2A a, b1-b2 (Video) Schultz Electronics manufactures two ultra high-definition television models: the Royale which sells for $1,480, and a new model, the Majestic, which sells for $1,270. The production cost computed per unit under traditional costing for each model in 2020 was as follows. Royale Majestic Traditional Costing Direct materials Direct labor ($20 per hour) Manufacturing overhead ($43 per DLH) Total per unit cost .62 In 2020, Schultz manufactured 25,000 units of the Royale and 10,000 units of the Majestic The overhead rate of $43 per direct labor hour was determined by dividing total estimated manufacturing overhead of $8,577,700 by the total direct labor hours (200,000) for the two models Under traditional costing, the gross profit on the models was Royale $502 ($1,400-978) and Majestic $545 (51,270 - $725). Because of this difference, management is considering phasing out the Royale model and increasing the production of the Majestic model Before finalizing its decision, management asks Schultz's controller to prepare an analysis using activity based costing (ABC). The controller accumulates the following information about overhead for the year ended December 31, 2020. Activity Cost Pools Purchasing Machine setups Cost Drivers Number of orders Number of setups Machine hours Number of inspections Estimated Overhead $1,346,400 956,800 5,386,500 888,000 Estimated Use of Cost Drivers 40,800 18,400 119,700 29,600 Activity-Based Overhead Rate s order $52/setup $45/hour $30/inspection Machining Quality control The cost drivers used for each product were: Cost Drivers Purchase orders Mahir seuns Royale 17,000 Majestic 23,800 Total 40,800 CALCULATOR PRINTER VERSION BACK NEXT The cost drives used for each product were Cost Drivers Purchase orders Machine setups Machine hours Inspections Royale 17,000 5,000 74,000 11,000 Majestic 23,800 13,400 45,700 18,600 Total 40,800 18,400 119,700 29,600 Assign the total 2020 manufacturing overhead costs to the two products using activity-based costing (ABC) and determine the overhead cost per unit. (Round cost per unit to z decimal places. 12.25.) Royale Majestic Total assigned costs Cost per unit Calculate cost per unit of each model using ABC costing (Round answers to 2 decimal places, e.g. 12.25.) Royale Majestic Cost per unit 978 725 calculate gross pront of each model using ABC costing. (Round answers to 2 decimal places c.9. 12.25.) Royale Majestic Gross profit