Siegel Corporation manufactures a product available in both a deluxe and a regular model. The company has made the regular model for years; the deluxe model was introduced several years ago to capture a new segment of the market. Since the introduction of the deluxe model, the company's profits have steadily declined, and management has become concemed about the accuracy of its costing system. Sales of the deluxe model have been increasing rapidly Overhead is applied to products on the basis of direct labour-hours. At the beginning of the current year, management estimated that $1,270,100 in overhead costs would be incurred and the company would produce and sell 10,000 units of the deluxe model and 41,735 units of the regular model. The deluxe model requires 3.2 hours of direct labour time per unit, and the regular model requires 1.4 hours. Materials and labour costs follow: Direct materials cost per unit Direct labour cost per hour Required: Deluxe $160 21 Regular $92 14 1. Compute the predetermined overhead rate using direct labour-hours as the basis for allocating overhead costs to products Compute the unit product cost for one unit of each model. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Predetermined overhead rate Unit product cost of Deluxe. Unit product cost of Regular per DLH 2. An intern suggested that the company use activity-based costing to cost its products. A team was formed to investigate this idea, and it came back with the recommendation that four activity cost pools be used. These cost pools and their associated activities follow: Activity Cost Pool and Activity Measure Purchase orders (number of orders) Rework requests (number of requests) Product testing (number of tests) Machine related (machine-hours) Estimated Overhead Cost Activity $ 193,2001 Deluxe 900 Regular Total 134,400 262,500 200 5,000 1,400 400 12,500 2,300 600 17,500 680,000 $1,270,100 12,000 22,000 34,000 Compute the activity rate (ie., predetermined overhead rate) for each of the activity cost pools. Activity Cost Pool Purchase orders Rework requests Activity Rate per order i per request Product testing Machine related per test per MH 3. Assume that actual activity is as expected for the year. Using activity-based costing, do the following a. Determine the total amount of overhead that would be applied to each model for the year. (Do not round intermediate calculations and round your final answers to nearest whole dollar amount.) Total overhead cost Deluxe Regular b. Compute the unit product cost for one unit of each model. (Do not round intermediate calculations and round your answers to 2 decimal places.) Unit product cost Deluxe Regular