On january 1, 2017, seven wonders inc. signed a five-year noncancelable lease with moss company. the lease calls for five payments of $277,409.44 to be made at the end of each year. the leased asset has a fair value of $1,200,000 on january 1, 2017. seven wonders cannot renew the lease, there is no bargain purchase option, and ownership of the leased asset reverts to moss at the lease end. the leased asset has an expected useful life of six years, and seven wonders uses straight-line depreciation for financial reporting purposes. its incremental borrowing rate is 12%. moss’s implicit rate of return on the lease is unknown. seven wonders uses a calendar year for financial reporting purposes. both companies use asc 840 to account for leases.

Laval produces lamps and home lighting fixtures. its most popular product is a brushed aluminum desk lamp. this lamp is made from components shaped in the fabricating department and assembled in the assembly department. information related to the 22,000 desk lamps produced annually follows.direct materials $280,000direct labor fabricating department (8,000 dlh × $24 per dlh) $192,000assembly department (16,600 dlh × $26 per dlh) $431,600machine hours fabricating department $15,200mhassembly department $20,850mhexpected overhead cost and related data for the two production departments follow.fabricating assemblydirect labor hours 150,000dlh 295,000dlhmachine hours 161,000mh 128,000mhoverhead cost $400,000 430,000required1. determine the plantwide overhead rate for laval using direct labor hours as a base.2. determine the total manufacturing cost per unit for the aluminum desk lamp using the plantwide overhead rate.3. compute departmental overhead rates based on machine hours in the fabricating department and direct labor hours in the assembly department.4. use departmental overhead rates from requirement 3 to determine the total manufacturing cost per unit for the aluminum desk lamps.