A company computed the following activity rates using activity-based costing.

Activity	Activity Rate
Setup	$ 2,000	per setup
Materials handling	$ 100	per materials requisition
Inspection	$ 4	per unit inspected

The companys deluxe model used the following activities to produce 2,000 units. Compute the overhead cost per unit for the deluxe model using activity-based costing.

Activity	Activity Rate
Setup	6	setups
Materials handling	50	materials requisitions
Inspection	2,000	units inspected

Multiple Choice

• $8.00.

• $4.50.

• $6.00.

• $8.50.

• $12.50.