Ice Cool produces two different models of air conditioners. The activities, costs, and cost drivers associated with the production processes follow.

Additional production information concerning its two models follows.

1. Compute the activity rate for each activity using activity-based costing.
2. Using activity-based costing, compute the overhead cost per unit for each model.
3. Compute the total product cost per unit for each model.
4. For each model, compute the gross profit per unit (selling price per unit minus product cost per unit).

Transcribed Image Text:

Process Assembly Activity Machining Setups Finishing Inspection Support Purchasing Budgeted Cost $279,000 24,000 $303,000 $210,000 $135,000 Activity Cost Driver Budgeted Activity Usage Machine hours (MH) Setups Inspections Purchase orders 6,000 120 700 450