Casual Cuts Inc. has total estimated factory overhead for the year of $225,000, divided into four activities: cutting, $90,000; sewing, $22,500; setup, $80,000; and inspection, $32,500. Casual Cuts manufactures two types of men's pants: jeans and khakis. The activity-base usage quantities for each product by each activity are as follows:

Each product is budgeted for 10,000 units of production for the year. Determine
a. The activity rates for each activity
b. The factory overhead cost per unit for each product, using activity-based costing.

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Sewing 1,000 dlh Cutting 500 dlh 1,000 1,500 dlh Setup Inspection 100 inspections Jeans 250 setups Khakis 750 1,500 dlh 1,000 setups 500 inspections