Hercules Inc. manufactures elliptical exercise machines and treadmills. The products are produced in its Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follows: Activity Activity Rate Fabrication $30 per machine hour
Assembly $14 per direct labor hour
Setup $53 per setup
Inspecting $26 per inspection
Production scheduling $15 per production order
Purchasing $12 per purchase order
The activity-base usage quantities and units produced for each product were as follows:
Activity Base Elliptical Machines Treadmill
Machine hours 1,666 983
Direct labor hours 479 187
Setups 51 16
Inspections 736 442
Production orders 63 13
Purchase orders 170 104
Units produced 271 182
Use the activity rate and usage information to determine the total activity cost and activity cost per unit for each product.