Tiger Pride produces two product lines: T-shirts and Sweatshirts. Product profitability is analyzed as follows:

T-SHIRTSSWEATSHIRTS

Production and sales volume 60,000 units35,000 units

Selling price$16.00 $29.00

Direct material $ 2.00$ 5.00

Direct labor $ 4.50$ 7.20

Manufacturing overhead $ 2.00 $ 3.00

Gross profit $ 7.50$13.80

Selling and administrative $ 4.00 $ 7.00

Operating profit $ 3.50 $ 6.80

1. What is projected operating income if direct materials costs of T-Shirts increase to $4.00 per unit and direct labor costs of Sweatshirts increase to $8.20 per unit?
2. Under the revised ABC system, the activity-cost driver rate for the supervision activity is________.