Musich Corporation has an activity-based costing system with three activity cost pools–Machining, Setting Up, and Other. The company’s overhead costs, which consist of equipment depreciation and indirect labor, have been allocated to the cost pools already and are provided in the table below.

Activity Cost Pools

Machining

Setting Up

Other

Total

Equipment depreciation

$

9400

$

48,700

$

23,800

$

81,900

Indirect labor

4500

2900

4100

11,500

Total

$

13,900

$

51,600

$

27,900

$

93,400

Costs in the Machining cost pool are assigned to products based on machine-hours (MHs) and costs in the Setting Up cost pool are assigned to products based on the number of batches. Costs in the Other cost pool are not assigned to products. Data concerning the two products and the company’s costs appear below:

MHs

Batches

Product Z3

6000

750

Product T1

6200

1350

Total

12,200

2100

Product Z3      Product T1

Sales (total)

$

230,800

$

255,500

Direct materials (total)

$

84,000

$

97,600

Direct labor (total)

$

110,000

$

105,200


Required:

Calculate the following:

Machining Activity Rate

$

Setting up Activity Rate

$

Amount of OH applied to product Z3 (round to the nearest dollar)

$

Amount of OH applied to product T1 (round to the nearest dollar)

$

Product Margin – Z3 (round to the nearest dollar)

$

Product Margin – T1 (round to the nearest dollar)

$