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 Activity Components Changeover Machining Setups Quantity 710 8,210 100 Finishing Welding Inspecting Rework Overhead Cost Driver $ 456,000 Number of batches 302,000 Machine hours 232,000 Number of setups $ 990,000 $ 182,000 Welding hours 223,000 Number of inspections 64,000 Rework orders $ 469,000 $ 143,000 Purchase orders 32,500 Number of units 66,000 Number of units $ 241,500 5,200 880 220 Support Purchasing Providing space Providing utilities 537 4,940 4,940 Additional production information concerning its two product lines follows. Units produced Welding hours Batches Number of inspections Machine hours Setups Rework orders Purchase orders Model 145 1,900 2,200 355 480 2.850 Model 212 3,040 3,000 355 400 5,360 50 50 130 90 358 179 Required: 1. Determine departmental overhead rates and compute the overhead cost per unit for each product line. Base your overhead assignment for the components department on machine hours. Use welding hours to assign overhead costs to the finishing department. Assign costs to the support department based on number of purchase orders. 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $310 for Model 145 and $160 for Model 212. 3. If the market price for Model 145 is $1,550 and the market price for Model 212 is $260, determine the profit or loss per unit for each Components department Finishing department Support department Model 145 Activity Driver Departmental OH Rate Total Overhead Cost Components Finishing Support 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 $310 for Model 145 and $160 for Model 212. (Round your intermediate calculations and cost per unit answers to 2 decimal places.) Model 145 Model 212 Materials and Labor per unit Overhead cost per unit Total cost per unit Required 1 Required 2 Required 3 If the market price for Model 145 is $1,550 and the market price for Model 212 is $260, determine the profit or loss per unit for each model. (Loss amounts should be indicated with a minus sign. Round your intermediate calculations and final answers to 2 decimal places.) Model 145 Model 212 Market price per unit Cost per unit Profit (loss) per unit
