Given Data: Direct materials cost per unit Direct labor cost per unit Sales price per unit Expected unit production per month Junior $92 $51 $390 4000 Expert $115 $75 $615 9000 Cost Drivers Number of setups required Number of inspections Number of Machine hours Number of engineering hours Junior 60 975 350 352 Expert 86 675 650 612 Total 146 1650 1000 964 Overhead Cbst Pools: Setups Quality Control Maintenance Engineering Overhead Costs $136,364 $163,020 $78,840 $106,522 $484,746 1 Overhead assigned to each product under traditional costing system Traditional costing overhead rate Junior Expert Total Traditional Overhead applied 2 Calculate the traditional product unit cost Junior Espert Material Labor Overhead Total Product Cost 3 Calculate Unit Gross Margin per product Junior Expert Sales COGS Gross Margin 4 Calculate Activity Rates OH cents Driver Driver Vol. Activity Rate Cost Pool Setups Quality Control Maintenance Engineering Total 5 Apply activity overhead Junior Expert Total Setups Quality Control Maintenance Engineering Total Overhead Per Unit OH 6 Calculate per unit ABC cost Junior Expert Material Labor Overhead Total Product Cost 7 Calculate Unit Gross Margin for ABC costing Junior Expert Sales COGS Gross Margin Traditional Gross Margin 8 Unit Gross Margin Differences Difference