The Manhattan Company manufactures two models of compact disc players, deluxe and regular. The company has manufactured the regular model for years; the deluxe model was introduced recently to tap a new segment of the market. Although sales of the deluxe model have been increasing rapidly, the companys profits have steadily declined. Management has become increasingly concerned about the accuracy of its costing system. The current cost accounting system allocates manufacturing support costs to the two products on the basis of direct labor hours. For 2002, the company has estimated that it will incur $1 million in manufacturing support costs and produce 5,000 units of the deluxe model and 40,000 units of the regular model. The deluxe model requires two hours of direct labor and the regular model one hour. Direct costs and selling prices per unit are as follows: Deluxe Regular Direct Material $45 $30 Direct Labor $20 $10 Selling Price $140 $80 The company is considering switching to an ABC system. A recent cost study revealed the following activities, costs and product requirements: Annual Activity Activity Requirements by Product Line Activity Cost Driver Deluxe Regular Purchase Orders $ 180,000 Number of Orders 600 400 Quality Control $ 250,000 Number of Inspections 1,000 1,000 Production Set-ups $ 220,000 Number of Set-ups 100 100 Machine Maintenance $ 350,000 Machine Hours 20,000 15,000 $1,000,000 Requirements: 1) Determine the per unit cost of the regular and deluxe model using the current costing system. (4 pts)