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Exercise 7-9 Computing Activity-Based Costing Product Costs (LO2, LO3] High-Calibre Products Corporation makes two products: titanium rims and posts. Data regarding the two products follow: Direct Labour- Hours per Unit 0.60 @.30 Annual Production 38,000 units 170,000 units Rims Posts Additional information about the company follows: a. Rims require $15 in direct materials per unit and posts require $8. b. The direct labour wage rate is $16 per hour. c. Rims are more complex to manufacture than posts, and they require special equipment. d. The ABC system has the following activity cost pools: Activity Rims Posts Estimated Overhead Cost $40,320 $281, 200 $738,000 170 Activity Measure Number of setups Machine-hours Direct labour-hours Total 360 7,600 73,800 190 7,600 22,800 Activity Cost Pool Machine setups Special processing General factory 51,000 Activity Cost Pool Machine setups Special processing General factory Activity Measure Number of setups Machine-hours Direct labour-hours Overhead Cost $40,320 $281,200 $738,000 Rims 190 7,600 22,800 Posts 170 Total 360 7,600 73,800 $1,000 Required: 1. Compute the activity rate for each activity cost pool. Activity Cost Pool Machine setups Special processing General factory Activity Rate per setup per MH per DLH 2. Determine the unit cost of each product according to the ABC system, including direct materials and direct labour. (Round your intermediate calculations and final answers to 2 decimal places.) Rims Posts Unit cost

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