Rollex Company makes two models of watchesregular and luxuriousand wants to further refine its costing system by allocating overhead costs using activity-based costing. The following information is provided for the production of two product lines:

Activity	Budgeted overhead costs	Allocation base
Machine setup	$231,500	Setup hours
Machine maintenance	$580,820	Machine hours
Administration	$155,800	Direct labor hours
Total overhead costs	$968,120

	Regular model	Luxurious model	Total
Direct labor hours	15,000	23,000	38,000
Setup hours	1,200	1,300	2,500
Machine hours	4,300	7,000	11,300

Rollex plans to produce 3,000 units of regular model and 1,200 units of luxurious model.

Q1. Compute the predetermined overhead allocation rate for administration activity.

		$4.10/DLHr
		$4.30/DLHr
		$4.50/DLHr
		$4.70/DLHr

Q2. Compute the allocated overhead cost per unit of luxurious model. Round to the nearest cents.

		$378.73
		$428.73
		$478.73
		$528.73