Real Cool produces two different models of air conditioners. The company produce

Question

Real 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 $500,000 Number of batches 800
Machining 279,000 Machine hours 6,000
Setups 225,000 Number of setups 120
$1,004,000
Finishing Welding $180,300 Welding hours 3,000
Inspecting 210,000 Number of inspections 700
Rework 75,000 Rework orders 300
$465,300
Support Purchasing $135,000 Purchase orders 450
Providing space 32,000 Number of units 5,000
Providing utilities 65,000 Number of units 5,000
$232,000

Additional production information concerning its two product lines follows.

Model 145 Model 212
Units produced 1,500 3,500
Welding hours 800 2,200
Batches 400 400
Number of inspections 400 300
Machine hours 1,800 4,200
Setups 60 60
Rework orders 160 140
Purchase orders 300 150

Question:
Using a plantwide overhead rate based on machine hours, compute the overhead cost per unit for each product line. (Round your answers to 2 decimal places. Omit the "$" sign in your response.)

Product Overhead cost
Model 145 ??/unit
Model 212 ??/unit

Explanation / Answer

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