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Vision Company produces modems. One of its plants produces two versions of modems: a basic model and a premium model. At the beginning of the
Vision Company produces modems. One of its plants produces two versions of modems: a basic model and a premium model. At the beginning of the year, the following data were prepared for the plant: Basic Premium Model Model Expected quantity 20,000 10,000 Selling price $90 $200 Prime costs $40 $80 Machine hours 2,500 2,500 Number of requisitions 500 1,500 Maintenance hours 2,000 6,000 Number of setups 8 32 Additionally, the following overheads activity costs are expected: Maintaining equipment $220,000 Setting up equipment $112,000 Purchasing materials $87,000 Total $419,000 Vision Company uses activity-based costing to calculate product cost. Required: What is the activity rate for maintaining equipment based on maintenance hours? age What is the activity rate for setting up equipment based on number of setups? What is the activity rate for purchasing materials based on number of requisitions? What is the unit cost of the basic model (rounded to the nearest cent)? ce What is the unit cost of the premium model (rounded to the nearest cent)
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