Way Cool produces two different models of air conditioners. The company produces the mechanical systems in its components department. The mechanical systems are combined with the housing assembly in its finishing department. The activities, costs, and drivers associated with these two manufacturing processes and the production support process follow. Process Activity Components Changeover Machining Setups Driver Number of batches Machine hours Number of setups Quantity 870 8,040 180 Finishing Welding Inspecting Rework Overhead Cost $ 517,650 368,232 333,000 $1,218,882 $ 302,500 261,000 32,800 $ 596,300 $ 153,450 32,000 118,540 $ 303,990 Welding hours Number of inspections Rework orders 5,000 870 160 Support Purchasing Providing space Providing utilities Purchase orders Number of units Number of units 465 7,800 7,800 Additional production information concerning its two product lines follows. Units produced Welding hours Batches Number of inspections Machine hours Setups Rework orders Purchase orders Model 145 2,600 1,800 435 510 2,750 90 100 310 Model 212 5,200 3,200 435 360 5,290 90 60 155 Required: 1. Using ABC, compute the overhead cost per unit for each product line. 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $260 for Model 145 and $119 for Model 212. 3. If the market price for Model 145 is $639.86 and the market price for Model 212 is $337.22, determine the profit or loss per unit for each model. Required 1 Required 2 Required 3 Using ABC, compute the overhead cost per unit for each product line. (Round your final answers to 2 decimal places.) Model Activity driver incurred Activity Expected Costs Expected Activity Activity Rate $ 517,650 870 Number of batches Components Changeover Machining Setups Finishing Welding Inspecting 368,232 333,000 8,040 Machine hours 180 Setups $ 302,500 261,000 5,000 Welding hours 870 Inspections 160 Rework orders Rework 32,800 Support Purchasing Providing space and utilities $ 465 Purchase orders 153,450 150,540 7,800 Units Total overhead cost Total units produced Overhead cost per unit ct line. (Round your final answers to 2 decimal places.) Model 145 Activity driver Overhead incurred assigned Model 212 Activity driver Overhead incurred assigned ected Activity Activity Rate Number of batches Machine hours Setups Welding hours Inspections Rework orders 5 Purchase orders Units Total overhead cost Total units produced Overhead cost per unit Required 1 Required 2 Required 3 Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $260 for Model 145 and $119 for Model 212. (Round your final answers to 2 decimal places.) Model 145 Model 212 Materials and Labor per unit Overhead cost per unit Total cost per unit Required 1 Required 2 Required 3 If the market price for Model 145 is $639.86 and the market price for Model 212 is $337.22, determine the profit or loss per unit for each model. (Round your final answers to 2 decimal places.) Model 145 Model 212 Price per unit Cost per unit Profit (loss) per unit
