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Rocky Mountain Corporation makes two types of hiking bootsXactive and the Pathbreaker. Data concerning these two product lines appear below:

	Xactive			Pathbreaker
Direct materials per unit	$	64.80		$	51.00
Direct labor cost per unit	$	18.20		$	13.00
Direct labor-hours per unit		1.4	DLHs		1.0	DLHs
Estimated annual production and sales		25,000	units		75,000	units

The company has a conventional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below:

Estimated total manufacturing overhead	$2,200,000
Estimated total direct labor-hours	110,000	DLHs

Required:
1-a.	Compute the predetermined overhead rate based on direct labor-hours.

Predetermined overhead rate

$ per DLH

1-b.	Using the predetermined overhead rate and other data from the problem, determine the unit product cost of each product.

	Xactive	Pathbreaker
Unit product cost	$	$

2.	The company is considering replacing its conventional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools:

Activities and Activity Measures	Estimated Overhead Cost		Expected Activity
			Xactive	Pathbreaker	Total
Supporting direct labor (direct labor-hours)	$	797,500	35,000	75,000	110,000
Batch setups (setups)		680,000	250	150	400
Product sustaining (number of products)		650,000	1	1	2
General factory (machine-hours)		72,500	2,500	7,500	10,000
Total manufacturing overhead cost	$	2,200,000

Determine the activity rate for each of the four activity cost pools.(Round your answers to 2 decimal places.)

Activity Cost Pools	Activity Rate
Supporting direct labor	$	per DLH
Batch setups	$	per setup
Product sustaining	$	per product
General factory	$	per MH

3.	Using the activity rates and other data from the problem, determine the unit product cost of each product. (Do not round intermediate calculations. Round your answers to 2 decimal places.)

	Xactive	Pathbreaker
Unit product cost	$	$

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