Rooney Ctrerstor, Inc. manufactures two models of cameras. Model ZM has a zoom lens; Model DS has a fixed lens. Rooney uses an activity-based costing system. The following are the relevant cost data for the previous month:

Direct Cost per Unit	Model ZM			Model DS
Direct materials	$	20.20		$	9.00
Direct labor		28.40			11.00

Category	Estimated Cost					Cost Driver	Use of Cost Driver
Unit level		$	24,990			Number of units	ZM: 2,400 units; DS: 9,500 units
Batch level			43,680			Number of setups	ZM: 24 setups; DS: 24 setups
Product level			88,750			Number of TV commercials	ZM: 13; DS: 12
Facility level			228,000			Number of machine hours	ZM: 400 hours; DS: 800 hours
Total		$	385,420

Rooneys facility has the capacity to operate 3,600 machine hours per month.

Required

1. Compute the cost per unit for each product.

2. The current market price for products comparable to Model ZM is $120 and for DS is $87. If Rooney sold all of its products at the market prices, what was its profit or loss for the previous month?

3. A market expert believes that Rooney can sell as many cameras as it can produce by pricing Model ZM at $115 and Model DS at $40. Rooney would like to use those estimates as its target prices and have a profit margin of 30 percent of target prices. What is the target cost for each product?

a.

Compute the cost per unit for each product. (Round intermediate calculations and final answers to 2 decimal places.)

Type of Product	Direct Materials	+	Direct Labor	+	Allocated Overhead	=	Total
Model ZM		+		+		=	$0.00
Model DS		+		+		=	0.00

b.

The current market price for products comparable to Model ZM is $120 and for DS is $87. If Rooney sold all of its products at the market prices, what was its profit or loss for the previous month? (Round intermediate calculations to 2 decimal places. Loss amounts should be indicated by a minus sign.)

		Amount
Model ZM
Model DS

c.

A market expert believes that Rooney can sell as many cameras as it can produce by pricing Model ZM at $115 and Model DS at $40. Rooney would like to use those estimates as its target prices and have a profit margin of 30 percent of target prices. What is the target cost for each product? (Round your answers to 2 decimal places.)

	Model ZM	Model DS
Target cost / unit