TeleTech Corporation manufactures two different color printers for the business market. Cost estimates for the two models for the current year are as follows:

Basic System Advanced System

Direct material: $ $400$ $ $800$

Direct labor $(20$ hours at $$16$ per hour$)320320$

Manufacturing overhead$*420420$

Total $ $1,140$ $ $1,540$

$*$The predetermined overhead rate is $$21$ per direct$-$labor hour.

Each model of printer requires $20$ hours of direct labor. The basic system requires $5$ hours in department A and $15$ hours in department B$.$ The advanced system requires $15$ hours in department A and $5$ hours in department B$.$ The overhead costs budgeted in these two production departments are as follows:

Department A Department B

Variable cost $ $16$ per direct$-$labor hour $ $4$ per direct$-$labor hour

Fixed cost $ $220,000$ $ $220,000$

The firm$$s management expects to operate at a level of $20,000$ direct$-$labor hours in each production department during the current year. $($This estimate is based on the practical capacity of each department.$)2.$ If the firm prices each model of color printer at $10$ percent over its cost, what will be the price of each model? $3.$ Suppose the company were to use departmental predetermined overhead rates. Calculate the rate for each of the two production departments. $4.$ Compute the product cost of each model using the departmental overhead rates calculated in requirement $5.$ Compute the price to be charged for each model, assuming the company continues to price each product at $10$ percent above cost. Use the revised product costs calculated in requirement $(4).$