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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. Process Components Activity Changeover Machining Setups Driver Number of batches Machine hours Number of setups Quantity 870 7,750 120 Finishing Welding Inspecting Rework Overhead Cost $ 491,550 354,950 216,600 $1,063, 100 $ 346,620 260,000 60,900 $ 667,520 5 163, 170 30,900 31,470 $ 225,540 Welding hours Number of inspections Rework orders 5,300 800 210 Support Purchasing Providing space Providing utilities Purchase orders Number of units Number of units 518 3,300 3,300 Additional production information concerning its two product lines follows. Model 212 2,209 Units produced Welding hours Batches Number of inspections Machine hours Setups Rework orders Purchase orders Model 145 1,100 1,600 435 460 2,450 60 110 345 3,700 435 340 5,300 60 100 173 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 $230 for Model 145 and $114 for Model 212. 3. If the market price for Model 145 is $1,032.16 and the market price for Model 212 is $602.79, 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 145 Activity driver Overhead incurred assigned Model 212 Activity driver Overhead incurred assigned Expected Costs Expected Activity Activity Rate $ 491,550 354,950 216,600 870 Number of batches 7,750 Machine hours 120 Setups Activity Components Changeover Machining Setups Finishing Welding Inspecting Rework Support Purchasing Providing space and utilities $ 346.620 260,000 60,900 5,300 Welding hours 800 Inspections 210 Rework orders $ 163,170 62,370 518 Purchase orders 3,300 Units $ 0 $ 0 Total overhead cost Total units produced Overhead cost per unit Complete this question by entering your answers in the tabs below. 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 $230 for Model 145 and $114 for Model 212. (Round your final answers to 2 decimal places.) Model 145 Model 212 $ 230.00 $ 114.00 Materials and Labor per unit Overhead cost per unit Total cost per unit If the market price for Model 145 is $1,032.16 and the market price for Model 212 is $602.79, determine the profit or loss per unit for each model. (Round your final answers to 2 decimal places.) Model 145 Model 212 $ 1,032.16 $ 602.79 Price per unit Cost per unit Profit (loss) per unit
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