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 Activity Components Changeover Machining Setups Driver Number of batches Machine hours Number of setups Quantity 800 6,000 120 Finishing Welding Inspecting Rework Overhead Cost $ 500,000 279,000 225,000 $1,004,000 $ 180,300 210,000 75,000 $ 465, 300 $ 135,000 32,000 65,000 $ 232,000 Welding hours Number of inspections Rework orders 3,000 700 300 Support Purchasing Providing space Providing utilities Purchase orders Number of units Number of units 450 5,000 5,000 Additional production information concerning its two product lines follows. Units produced Welding hours Batches Number of inspections Machine hours Setups Model 145 1,500 800 400 400 1,800 60 Model 212 3,500 2,200 400 300 4,200 60 Units produced Welding hours Batches Number of inspections Machine hours Setups Rework orders Purchase orders Model 145 1,500 800 400 400 1,800 60 160 300 Model 212 3,500 2,200 400 300 4,200 60 140 150 Required: Answer is complete but not entirely correct. 1. Using a plantwide overhead rate based on machine hours, compute the overhead cost per unit for each product line. Overhead costs $ X $ 224.39 per machine hour 1,676,220 Machine hours 7,470 X 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $250 for Model 145 and $180 for Model 212. Overhead Assigned Model 145 Model 212 Activity Plantwide Driver OH rate 2,270 X $ 224.39 5,200 X $ 224.39 Total Overhead Cost $ 509,365 $ 1,166,828 Units OH Cost Produced per unit 1,600 X $ 242.56 X 3,200 $ 277.82 X Model 145 Total manufacturing cost per unit: Materials and Labor Overhead $ 230.00 $ Model 212 140.00 X 277.82 242.56 Answer is complete but not entirely correct. 1. Using a plantwide overhead rate based on machine hours, compute the overhead cost per unit for each product line. $ Overhead costs X $ 224.39 per machine hour 1,676,220 Machine hours 7,470 X 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $250 for Model 145 and $180 for Model 212. Overhead Assigned Activity Plantwide Total Overhead Driver OH rate Cost 2,270 X $ 224.39 x $ 509,365 5,200 x $ 224.39 X $ 1,166,828 Model 145 Units OH Cost Produced per unit 1,600 X $ 242.56 X 3,200 X $ 277.82 X Model 212 Model 145 Model 212 $ $ 140.00 Total manufacturing cost per unit: Materials and Labor Overhead Total manufacturing cost 230.00 242.56 472.56 277.82 $ $ 417.82 3. If the market price for Model 145 is $820 and the market price for Model 212 is $480, determine the profit or loss per unit for each model. Model 145 Model 212 Market price $ 758.00 X $ 450.00 X Manufacturing cost per unit (472.56) (417.82) Profit(loss) per unit $ 285.44 X $ 32.18 X
