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ABC Inc. manufactures two types of chips - mini and micro, and applies overhead costs on the basis of direct labour hours. The anticipated overhead is $1,420,000. Information about the company's products follows. Estimated production volume Direct material per unit Direct labor per Init ($30/hr) Applied overhead mini 5,000 $60 $90 micro 6,250 $90 $120 ? ABC's overhead of $1,420,000 can be identified with three major activities: design processing ($240,000), machine processing ($1,000,000), and product check ($180,000). These activities are driven by the number of designs processed, machine hours worked, and check hours, respectively. Data relevant to these activities follows. Designs processed Machine hours worked per unit Check hours mini ? 18.40 8,000 micro ? 17.28 22,000 While the number of orders processed not known, management has informed you that it costs around $400 to process an order and the ratios of orders processed for mini and micro are (7/12) and (5/12) respectively. Management is very concerned about declining profitability despite a healthy increase in sales volume. Required: 1. Assuming use of activity-based costing, compute the unit manufacturing costs of the micro and mini products if the expected manufacturing volume is attained

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