Exercise $5-13$ Overhead Application $[$LO$3,$ LO$5]$

Sportway Inc. produces high$-$quality tennis racquets and golf clubs using a patented forming process and high$-$quality hand$-$finishing. Products move through two production departments: Forming and Finishing. The company uses departmental overhead rates to allocate overhead costs. Overhead is allocated based on machine$-$hours in Forming and direct labour cost in Finishing. Information related to costs for last year is provided below:

Tennis Racquets Golf Clubs

Annual production and sales $($units$)7,00011,000$

Direct materials cost per unit $ $5\mathrm{.}30$ $ $3\mathrm{.}50$

Direct labour cost per unit:

Forming Department $ $1\mathrm{.}00$ $ $\mathrm{.}50$

Finishing Department $ $7\mathrm{.}00$ $ $9\mathrm{.}00$

Machine$-$hours per unit:

Forming Department $0\mathrm{.}250\mathrm{.}25$

Finishing Department $0\mathrm{.}000\mathrm{.}50$

In addition, the firm budgets manufacturing overhead at $$65,750$ in the Forming Department and $$66,500$ in the Finishing Department.

Required:

$1.$ Determine the overhead application rate for each department. $($Round your answers to $2$ decimal places.$)$

$2.$ Determine the total cost per unit of tennis racquets and golf clubs. $($Round your intermediate calculations and final answers to $2$ decimal places.$)$