Siegel Company manufactures a product that is available in both a deluxe model and a regular model. The company has manufactured the regular model for years. The deluxe model was introduced several years ago to tap a new segment of the market. Since introduction of the deluxe model, the company's profits have steadily declined and management has become increasingly concerned about the accuracy of its costing system. Sales of the deluxe model have been increasing rapidly. Manufacturing overhead is assigned to products on the basis of direct laborhours. For the current year, the company has estimated that it will incur $6,008,900 in manufacturing overhead cost and produce 25,000 units ofthe deluxe model and 112,000 units of the regular model. The deluxe model requires 1.0 hours of direct labor time per unit. and the regular model requires 0.5 hour. Material and labor costs per unit are as follows: Hodel Deluxe Regular Direct materials $ 141 5 163 Direct labor $ 11 5 if ' Required: 1-a. Using direct labor-hours as the base for assigning manufacturing overhead cost to products, compute the predetermined overhead rate. 1b. Using the predetermined overhead rate computed in 1a above and other data from the problem, determine the unit product cost of each model. 2. Management is considering using activitybased absorption costing to apply manufacturing overhead cost to products. The activity based system would have the following four activity cost pools: Estimated Activity Cost Pool Activity Pleasure Overhead Cost Purchasing Purchase orders issued $ 331,350 Processing Machinehours 4,848,660 Scrapfrework Scrapfrework orders issued 3'55, 550 Shipping Number of shipments 882,669 $5,663,968 [ Expected Activity Activity Measure Deluxe Regular Total Purchase orders issued 4-76 94-6 1,410 Machinehours 26, 266 36, 368 56, 560 Scrapfrework orders issued 53"5 4-56 1,635 Number of shipments 5,646 7,556 12,668 Determine the predetermined overhead rate for each of the four activity cost pools. 3. Using the predetermined overhead rates you computed in part (2], do the following: a. Compute the total amount of manufacturing overhead cost that would be applied to each model using the activity-based absorption costing system. After these totals have been computed. determine the amount of manufacturing overhead cost per unit of each model. b. Compute the unit product cost of each model [including direct materials, direct labor, and manufacturing overhead]. Determine the predetermined overhead rate for each of the four activity cost pools. 3. Using the predetermined overhead rates you computed in part [2}, do the following: a. Compute the total amount of manufacturing overhead cost that would be applied to each model using the activitybased absorpti costing system. Alter these totals have been computed, determine the amount of manufacturing overhead cost per unit of each model. b. Compute the unit product cost of each model [including direct materials, direct labor, and manufacturing overhead}. Complete this question by entering wur answers in the labs below. RBI] 1A Req IB Req 2 Reg 3:\"; Reg 33 Using direct labor-hours as the base for assigning manufacturing overhead oust to products, compute the predetermined overhead rate. (Round your answer to 2 decimal places.) _