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Way Cool produces two different models of air conditioners. The company produces the mechanical systems in their components department. The mechanical systems are combined with

Way Cool produces two different models of air conditioners. The company produces the mechanical systems in their 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 Overhead Cost Driver Quantity
Components Changeover $ 476,000 Number of batches 750
Machining 314,000 Machine hours 8,210
Setups 231,000 Number of setups 140
$ 1,021,000
Finishing Welding $ 184,000 Welding hours 5,500
Inspecting 229,000 Number of inspections 895
Rework 63,000 Rework orders 250
$ 476,000
Support Purchasing $ 137,000 Purchase orders 531
Providing space 33,000 Number of units 5,210
Providing utilities 66,000 Number of units 5,210
$ 236,000

Additional production information concerning its two product lines follows.

Model 145 Model 212
Units produced 2,100 3,110
Welding hours 2,200 3,300
Batches 375 375
Number of inspections 505 390
Machine hours 2,850 5,360
Setups 70 70
Rework orders 130 120
Purchase orders 354 177

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 $230 for Model 145 and $130 for Model 212. 3. If the market price for Model 145 is $1,700 and the market price for Model 212 is $280, determine the profit or loss per unit for each model.

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. (Round your intermediate calculations and per unit cost answers to 2 decimal places.)

.
Components department
0
Finishing department
0
Support department
0
Model 145 Activity Driver Departmental OH Rate Total Overhead Cost
Components $0
Finishing $0
Support 0
Model 212 Activity Driver Departmental OH Rate Total Overhead Cost
Components $0
Finishing $0
Support 0

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 $130 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

3.

If the market price for Model 145 is $1,700 and the market price for Model 212 is $280, 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

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