Exercise 17-17 (Algo) Using activity-based costing to allocate overhead, compute product cost and gross profit LO P3 Ice Cool produces two different models of air conditioners. The activities, costs, and cost drivers associated with the production processes follow. Budgeted Process Activity Budgeted Cost Activity Cost Activity Driver Usage $ Machine hours Assembly Machining 311,000 (MH) 7,600 Setups 22,000 Setups 120 $ 333,000 Finishing Inspecting 232,000 Inspections 820 Support Purchasing 136,000 Purchase orders 540 Additional production information concerning its two models follows. Units and Model X Model Z Activities Units produced 1,800 3,600 Machine hours 2,200 5,400 Setups 40 80 Inspections 520 300 Purchase orders 360 180 Per Unit Model X Selling price per unit $ 400 Model Z $ 380 Direct materials cost 150 100 per unit Direct labor cost per 120 140 unit 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). Complete this question by entering your answers in the tabs below. Required Required Required Required 1 2 3 4 Compute the activity rate for each activity using activity-based costing. (Round "Activity rate" to 2 decimal places.) Activity Machining Setups Inspecting Purchasing Budgeted Cost Budgeted Activity Usage Activity Rate < Required 1 Required 2 >