Utica Manufacturing (UM) was recently acquired by MegaMachines, Inc. (MM), and organized as a separate division within the company. Most manufacturing plants at MM use an ABC system, but UM has always used a traditional product costing system. Bob Miller, the plant controller at UM, has decided to experiment with ABC and has asked you to help develop a simple ABC system that would help him decide if it was useful. The controller's staff has identified costs for the first month in the four overhead cost pools along with appropriate cost drivers for each pool. Cost Pools Costs Activity Drivers Incoming inspection $ 170,000 Direct material cost Production 1,500,000 Machine-hours Machine setup 700,000 Setups Shipping 488,880 Units shipped The company manufactures two basic products with model numbers 308 and 510. The following are data for production for the first month as part of MM. Products 308 510 $ 50,000 $ 18,000 $166,000 $198,000 60,000 90,000 Total direct material costs Total direct labor costs Total machine-hours Total number of setups Total pounds of material Total direct labor-hours Number of units produced and shipped 18,000 6,080 30,eee 9, eee 9,000 18,000 Required: a. The current cost accounting system charges overhead to products based on machine-hours. What unit product costs will be reported for the two products if the current cost system continues to be used? b. A consulting firm has recommended using an activity-based costing system, with the activities based on the cost pools identified by the cost accountant. What are the cost driver ates for the four cost pools identified by the cost accountant? c. What unit product costs will be reported for the two products if the ABC system suggested by the cost accountant's classification of cost pools is used? d. If management should decide to implement an activity-based costing system, what benefits should it expect? Complete this question by entering your answers in the tabs below. Required A Required Required C Required D The current cost accounting system charges overhead to products based on machine-hours. What unit product costs will be reported for the two products if the current cost system continues to be used? (Round your "Per unit cost" answers to 2 decimal places.) 308 510 Total cost Par unit cost Incoming inspection Production Machine setup Shipping % of material dollars per machine-hour per setup per unit 308 510 Total cost Per unit cost