The Storybrook Company produces chairs for outdoor patios and indoor dining rooms. The outdoor chairs are made of plastic and the indoor chairs are made of wood. The company has been using traditional job order costing based on the following data, and a plant-wide overhead rate:

	Outdoor	Dining Room
Expected Production	50,000 unit	150,000 unit
Direct material cost	$12.14 per unit	$28.64 unit
Direct labour cost	$10.86 per unit	$10.86 unit

The Storybrook Company is considering implementing an activity based costing system and has recently identified the following information:

	Budgeted Cost	Outdoor	Dining Room
Equipment setup	$44,000	50 setups	30 setups
Machine processing hours (MH)	$875,000	30,000 MH	220,000 MH
Quality control inspection hours (IH)	$630,000	5,000 IH	10,000 IH
Shipping	$80,000	125 shipments	75 shipments

1. Using activity based costing, calculate the cost per unit for each type of chairs. (7 Marks)