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Hi Tech Products manufactures three (3) types of CD players: Cheap,

Econo and Deluxe. Hi Tech uses an activity-based product costing system. The company has identified five (5) activities. Each activity, its cost and related activity driver are identified below:
Activity
Material handling Material insertion Automated machinery Finishing
Packaging
Total manufacturing cost
Activity Cost
$225 000 $2 475 000 $840 000 $170 000 $170 000 $3 880 000
Activity Driver
Number of parts Number of parts Machine hours Labour hours Orders shipped
The following information pertains to each product line of CD players:
Units to be produced Orders to be shipped Number of parts per unit Machine hours per unit Labour hours per unit
Cheap
10 000 1000 10
1
Econo Deluxe
5000 2000 500 200 15 25
3 5
2
Under an activity-based product costing system, what is the cost per unit of Cheap?
2 2
2

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