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Business, 07.03.2020 04:59 qveenjordan6456

Way 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 $ 458,000 Number of batches 810
Machining 307,000 Machine hours 7,650
Setups 232,000 Number of setups 160
$ 997,000
Finishing Welding $ 188,000 Welding hours 4,100
Inspecting 231,000 Number of inspections 835
Rework 62,000 Rework orders 150
$ 481,000
Support Purchasing $ 143,000 Purchase orders 525
Providing space 32,000 Number of units 5,020
Providing utilities 61,000 Number of units 5,020
$ 236,000

Additional production information concerning its two product lines follows.

Model 145 Model 212
Units produced 2,000 3,020
Welding hours 1,200 2,900
Batches 405 405
Number of inspections 465 370
Machine hours 2,350 5,300
Setups 80 80
Rework orders 100 50
Purchase orders 350 175
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.(Round your intermediate calculations and per unit cost answers to 2 decimal places.)

Components department
Finishing department
Support department
Model 145 Activity Driver Departmental OH Rate Total Overhead Cost
Components
Finishing
Support
Model 212 Activity Driver Departmental OH Rate Total Overhead Cost
Components
Finishing
Support
2.
Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $210 for Model 145 and $150 for Model 212. (Round your intermediate calculations and cost per unit answers to 2 decimal places.)

Model 145 Model 212
Materials and Labor per unit
Overhead per unit
Total cost per unit
Assume if the market price for Model 145 is $1,400 and the market price for Model 212 is $320, determine the profit or loss per unit for each model.(Round your intermediate calculations and final answers to 2 decimal places.)

Model 145 Model 212
Market price per unit
Cost per unit
Profit (loss) per unit

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