Hakara Company has been using direct labor costs as the basis
Hakara Company has been using direct labor costs as the basis for assigning overhead to its many products. Under this allocation system product A has been assigned overhead of 21.70 per unit while product B has been assigned 10.44 per unit. Management feels that an ABC system will provide a more accurate allocation of the overhead costs and has collected the following cost pool and cost driver information.Cost Pools Activity Costs Cost Driver Driver ConsumptionMachine Setup 340,000 Setup Hours 5,000Materials Handling 100,000 Pounds of materials 20,000Electric Power 24,000 Kilowatt Hours 24,000The following cost information pertains to the production of A and B, just two of its many products. A BNumber of units produced 5,000 10,000Direct Materials Cost 36,000 30,000Direct Labor Costs 27,000 34,000Number of Setup Hours 100 100Pounds of MAterials 2,000 1,000 Kilowatt Hours 2,000 2,000Use Activity based costing to determine a unit cost for each product. ( Round your final answers to 2 decimal places) Please show the work,