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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
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. (Loss amounts should be indicated with a minus sign. Round your intermediate calculations and round "Cost per unit and OH rate" answers to 2 decimal places.) Process Components Activity Changeover Overhead Cost Driver Machining Setups $ 457,500 300,400 229,000 Number of batches Machine hours Number of setups Quantity 850 7,530 60 $ 986,900 Finishing Welding $ 183,000 Welding hours 4,500 Inspecting Rework 229,000 60,900 Number of inspections 820 Rework orders 120 $472,900 Support Purchasing $ 137,000 Purchase orders 570 Providing space Providing utilities 31,700 Number of units 5,400 60,680 Number of units 5,400 $ 229,380 Additional production information concerning its two product lines follows. Units produced Model 145 Model 212 1,800 Welding hours 2,200 3,600 2,300 Batches 425 425 Number of inspections 495 325 Machine hours 2,280 5,250 Setups 30 30 Rework orders 70 50 Machine hours Setups Rework orders Purchase orders Required: 2,280 5,250 30 30 70 50 380 190 1. Using a plantwide overhead rate based on machine hours, compute the overhead cost per unit for each product line. Overhead costs Machine hours 7,530 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $280 for Model 145 and $130 for Model 212. Overhead Assigned Model 145 Model 212 0 Activity Driver Plantwide OH rate Total Overhead Cost Units Produced OH Cost per unit $ 0 $ Model 145 Model 212 3. If the market price for Model 145 is $749 and the market price for Model 212 is $490, determine the profit or loss per unit for each model. Machine hours 7,530 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $280 for Model 145 and $130 for Model 212. Overhead Assigned Model 145 Model 212 0 Activity Driver Plantwide OH rate Total Overhead Cost Units Produced OH Cost per unit 0 $ 0 Model 145 Model 212 3. If the market price for Model 145 is $749 and the market price for Model 212 is $490, determine the profit or loss per unit for each model. Model 145 Market price Model 212
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