ABC Bernacke Corp. is instituting an activity-based costing project in its ten-person purchasing department. Annual departmental overhead costs are 731,250. Because finding the best supplier takes the majority of effort in the department, most of the costs are allocated to this activity area. Many purchase orders are received in a single shipment.

Activity Allocation Measure Quantity Total Cost
Find best suppliers Number of telephone calls 75,000375,000
Issue purchase orders Number of purchase orders 46,875 187,500
Review receiving reports Number of receiving reports 28,125 168,750

One special-order product manufactured by the company required the following purchasing department activities: 25 telephone calls, 50 purchase orders, and 35 receipts.

Required:
a. What amount of purchasing department cost should be assigned to this product?
b. If 100 units of the product are manufactured during the year, What is the purchasing department cost per unit?
c. If purchasing department costs had been allocated using telephone calls as the allocation base, how much cost would have been assigned to this product?