TBD Corp manufactures two products, Product B and Product H. Product H is of fairly recent origin, having been developed as an attempt to enter a market closely related to that of Product B. Product H is the more complex of the two products, requiring two hours of direct labor time per unit to manufacture compared to one hour of direct labor time for Product B. Product H is produced on an automated production line. Overhead is currently assigned to the products on the basis of direct labor-hours. The company estimated it would incur $450,000 in manufacturing overhead costs and produce 7,500 units of Product H and 30,000 units of Product B during the current year. Unit costs for materials and direct labor are:

Direct Material: $12 (Product B), $25 (Product H)

Direct Labor: $10 (Product B), $20 (Product H)

a. Compute the predetermined overhead rate under the current method of allocation and

determine the unit product cost of each product for the current year.

b The company's overhead costs can be attributed to four major activities. These activities and the amount of overhead cost attributable to each for the current year are given below:

Activity Cost Pools	Estimated Overhead	Product B	Product H	Total
Machine Setups Required	$180,000	600	1200	1800
Purchase orders issued	$38,382	500	100	600
Machine Hours Required	$92,650	6800	10200	17000
Maintenace requests issued	$138,968	700	900	1600
	$450,000

Using the data above and an activity-based costing approach, determine the unit product cost of each product for the current year.

c. What other methods could you have used to calculate the cost of the products?

d. Discuss differences in methods above.