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Carlton's Kitchens makes two types of pasta makers: Strands and Shapes. The company expects to manufacture 60,000 units of Strands, which has a per-unit direct material cost of $10 and a per-unit direct labor cost of $45. It also expects to manufacture 40,000 units of Shapes, which has a per-unit material cost of $15 and a per-unit direct labor cost of $30. It is estimated that Strands will use 120,000 machine hours and Shapes will require 80,000 machine hours. Historically, the company has used the traditional allocation method and applied overhead at a rate of $10.91 per machine hour. It was determined that there were three cost pools, and the overhead for each cost pool is shown:

Machine Setups	$82,500
Machine Processing	2,000,000
Material Requisitions	100,000
Total Overhead	$2,182,500

The cost driver for each cost pool and its expected activity is shown:

	Strands	Shapes	Total
Machine Setups	110	220	330
Machine Hours	120,000	80,000	200,000
Parts Requisitions	80	120	200

A. What is the per-unit cost for each product under the traditional allocation method? Round your answers to two decimal places.

	Strands	Shapes
Total per unit cost	$	$

B. What is the per-unit cost for each product under ABC costing? Round your answers to two decimal places.

	Strands	Shapes
Total cost	$	$

C. Compared to ABC costing, was each product's overhead under- or overapplied?

D. By how much was overhead under- or overapplied for each product? Round your answers to two decimal places.

	Overhead	Amounts
Strands	Overapplied	$
Shapes	Underapplied	$

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