The Klamath Corp. produces two products, saws and drills. Three activities are used in their manufacture. These activities and their associated costs and bases are as follows: Activity Budgeted Costs Activity Base
Stamping $200,000 Machine hours
Assembly $400,000 Labor hours
Setup $30,000 Number of setups

Activity Base Saws Drills Total
Machine hours 4,000 6,000 10,000
Labor hours 7,000 13,000 20,000
Number of setups 3 12 15
Units produced 500 600

Required:
a. Determine the activity rate for each activity.
b. Determine the overhead cost per unit for each product.