Patricia Zell, a dollmaker from Olney, Maryland, is interested in the mass marketing

Cost per unit = $103.37 under activity based costing.

Explanation:

Calculating Activity cost rate per activity

Activity                    Cost               Cost Driver              Rate = Cost/Cost Driver

Assembly                 $504,520         47,000 MH             $10.734 MH

Processing Order    $57,263          1,400 orders            $40.90 per order

Order Inspection     $80,589           1.410 insp hours      $57.155 per hour

Cost of product L19B

Assembly = $10.734 X 1,050 = $11,270.7

Processing order = $40.90 X 130 = $5,317

Order Inspection = $57.155 X 80 = $4,572.4

Direct Material = $43.74 X 490 units = $21,432.6

Direct Labor = $16.45 X 490 units = $8,060.5

Total product cost = $50,653.2

Total units produced and sold = 490

Cost per unit = $50,653.2/490 = $103.37 under activity based costing.