Camper-Craft Corporation produces two lines of tents sold to outdoor enthusiasts. The tents are cut to specifications in department A. In department B the tents are sewn and folded. The activities, costs, and drivers associated with these two manufacturing processes and its production support activities follow.

Additional production information on the two lines of tents follows.

Required
1. Using a plantwide overhead rate based on direct labor hours, compute the overhead cost that is assigned to each pup tent and each pop-up tent.
2. Using the plantwide overhead rate, determine the total cost per unit for the two products if the direct materials and direct labor cost is $25 per pup tent and $32 per pop-up tent.
3. If the market price of the pup tent is $65 and the market price of the pop-up tent is $200, determine the gross profit per unit for each tent. What might management conclude about the pup tent?
4. Using ABC, compute the total cost per unit for each tent if the direct labor and direct materials cost is $25 per pup tent and $32 per pop-up tent.
5. If the market price is $65 per pup tent and $200 per pop-up tent, determine the gross profit per unit for each tent. Comment on the results.
6. Would your pricing analysis be improved if the company used, instead of ABC, departmental rates determined using machine hours in Department A and direct labor hours in Department B?Explain.

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Process Activity Overhead Cost Driver Quantity Department A Pattern alignment Cutting $64.400 Batches 560 12,300 2,400 5030 Machine hours 00,800 $215,630 Moving product Moves $327.600 24,000 47,880 $399,480 Department B Sewing Inspecting Folding Direct labor hours Inspections Units 4,200 600 22,800 Modification orders 280 8,600 920,000 Support Design Providing space Materials handling $280,000 51.600 Square feet 184000 Square yard:s $515,600 Pup Tent Pop-Up Tent Units produced Moves....800 moves Batches.*. Number of inspections 240 inspections Machine hours . Direct labor hours .. . 2.600 DLH Modification orders.... 70 modification os 210 modification orders Space occupied Material required450,000 square yards 470000 square yards 7.600 units 1.600 moves 420 batches 360 inspections 5.300 MH 1.600 DLH 140 batches .4,300 square feet 4.300 square feet