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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 730 8,120 180 Finishing Welding Inspecting Rework Overhead Cost $ 462,000 301,000 235,000 $ 998,000 $ 188,000 232,000 61,500 $ 481,500 $ 149,000 34,500 65,000 $ 248,500 Welding hours Number of inspections Rework orders 5,400 855 180 Support Purchasing Providing space Providing utilities Purchase orders Number of units Number of units 543 4,750 4,750 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 1,700 1,200 365 465 2,850 90 100 362 Model 212 3,050 4,200 365 390 5,270 90 80 181 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 $180 for Model 145 and $140 for Model 212. 3. If the market price for Model 145 is $2,075 and the market price for Model 212 is $270, determine the profit or loss per unit for each model. ok it Complete this question by entering your answers in the tabs below. at nces Required 1 Required 2 Required 3 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.) Show less Components department Finishing department 0 M
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