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Walnut Systems produces two different products Product A, which sells for $138 per unit, and Product B, which sells for $195 per unit, using three
Walnut Systems produces two different products Product A, which sells for $138 per unit, and Product B, which sells for $195 per unit, using three different activities: Design, which uses Engineering Hours as an activity driver; Machining, which uses machine hours as an activity driver; and Inspection, which uses number of batches as an activity driver. The cost of each activity and usage of the activity drivers are as follows: Design (Engineering Hours) Machining Machine Hours) Inspection (Batches) Cost $163,908 $531,720 $ 24,705 Usage by Product A 214 1,130 44 Usage by Product B 308 3,090 17 Walnut manufactures 10,800 units of Product A and 8,500 units of Product B per month. Each unit of Product A uses $44 of direct materials and $18 of direct labor, while each unit of Product Buses $73 of direct materials and $34 of direct labor. Required: a. Calculate the activity rate for design. Rate for Design per hour b. Calculate the activity rate for machining Rate for Machining per hour c. Calculate the activity rate for inspection. Rate for Inspection per batch d. Determine the indirect costs assigned to Product A. Indirect Costs e. Determine the indirect costs assigned to Product B. Indirect Costs f. Determine the manufacturing cost per unit for Product A. (Round your answer to 2 decimal places.) Manufacturing Cost per unit g. Determine the manufacturing cost per unit for Product B. (Round your answer to 2 decimal places.) Manufacturing Cost per unit h. Determine the gross profit per unit for Product A. (Round your intermediate calculation to 2 decimal places. Round your answer to 2 decimal places.) Gross Profit per unit i. Determine the gross profit per unit for Product B. (Round your intermediate calculation to 2 decimal places. Round your answer to 2 decimal places.) Gross Profit per unit
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