Health Solutions, Inc. makes two types of health bars and is implementing an ABC system. Previously, all overhead totaling $81,000 had been applied on the basis of machine hours (9,000 total for the period; 5,000 for Nutty Bars and 4,000 for Raisin Bars). The company produces 22,500 units of Nutty Bars and 42,284 units of Raisin Bars. Additional data is as follows:
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Cost Driver and
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Estimated
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Estimated Level
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Overhead
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Use of Cost Driver
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Use of Cost Driver
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Cost Pool
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of Activity
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Cost
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by Nutty Bars
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by Raisin Bars
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Equipment Setup
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100 setups
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$20,000
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65 setups
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35 setups
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Materials Ordering
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140 orders
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$21,000
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95 orders
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45 orders
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Quality Control
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200 inspections
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$22,000
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150 inspections
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50 inspections
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Mixing
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9,000 machine hours
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$18,000
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5,000 machine hours
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4,000 machine hours
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What is the overhead cost per unit for Nutty Bars when all overhead is applied based on machine hours using one plantwide rate? (Hint: Start by calculating the predetermined overhead rate per machine hour.)