Activity Rates and Activity-Based Product Costing
Hammer Company produces a variety of electronic equipment. Oneof its plants produces two laser printers: the deluxe and theregular. At the beginning of the year, the following data wereprepared for this plant:
| Deluxe | Regular |
| Quantity | 100,000 | 800,000 |
| Selling price | $900 | $750 |
| Unit prime cost | $529 | $483 |
In addition, the following information was provided so thatoverhead costs could be assigned to each product:
| Activity Name | Activity Driver | Deluxe | Regular | Activity Cost |
| Setups | Number of setups | 300 | 200 | $2,050,000 |
| Machining | Machine hours | 100,000 | 300,000 | 40,000,000 |
| Engineering | Engineering hours | 50,000 | 100,000 | 15,000,000 |
| Packing | Packing orders | 100,000 | 400,000 | 250,000 |
Required:
1. Calculate the overhead rates for eachactivity. If required, carry your answers out to the nearestcent.
| Setups | $ per setup |
| Machining | $ per machine hour |
| Engineering | $ per engineering hour |
| Packing | $ per packing order |
2. Calculate the per-unit product cost for eachproduct. Round your answers to the nearest whole dollar.
| Deluxe | $per unit |
| Regular | $per unit |
