XYZ Manufacturing makes two models of office chairs: regular and deluxe. Summary data for the two products showed the following:

Unit Costs Regular Deluxe

Direct materials $65.00 $105.00

Direct labour ($20 per hour) 10.00 20.00

Manufacturing overhead* 4.80 9.60

* Under the company's current costing, manufacturing overhead is allocated on the basis of direct labour-hours. The overhead for the year follows:

Materials handling $ 300,000

Setups 400,000

General factory overhead 500,000

Total $1,200,000

The following table presents the activity levels that relate to the overhead costs:

Cost Driver Regular Deluxe Total

Number of parts 600,000 900,000 1,500,000

Number of setups 75 50 125

Direct labour-hours 45,000 80,000 125,000

The market price for the regular chairs is $ 104 with expected sales of 40,000 units. The company expects to sell 25,000 deluxe chairs at a selling price of $170 per unit.

Required:

Determine the unit gross profit for the regular chair using both traditional and activity-based costing methods.