Answer:
a. Single Plant wide  Factory Overhead  Rate = $ 140 per machine hour
 Overhead Rate of  Assembly Department $ 120 per machine hour
 Overhead Rate of  Testing Department=    $ 150 per unit per machine hour.
Total Overhead per Unit    Commercial  $ 588      Residential $  462       
Explanation:
Pineapple Motor Company 
Assembly Department  Factory Overhead 360,000
Testing Department  Factory Overhead 900,000
Total  Factory Overhead 1,260,000
Direct machine hours were estimated as follows:
Assembly Department 3,000 hours
Testing Department 6,000
Total 9,000 hours
                                       Commercial              Residential
Assembly Department       1.4 dmh                    1.1 dmh
Testing Department             2.8                           2.2
Total machine hours per unit 4.2 dmh           3.3 dmh
Single Plant wide  Factory Overhead  Rate = Total  Factory Overhead 1,260,000/Total 9,000 hours
a. Single Plant wide  Factory Overhead  Rate = $ 140 per machine hour
Overhead Allocated to Assembly Department = No of Hours * Rate
                       = 3000  * $ 140 = $ 420,000
Overhead Allocated to Testing Department = No of Hours * Rate
                       = 6000  * $ 140 = $ 840,000
b. Overhead Rate of  Assembly Department = Factory Overhead / Machine Hours= 360,000/3,000 hours = $ 120 per machine hour
                      
Overhead Rate of  Testing Department=   Factory Overhead / Machine Hours=  900,000/ 6000 hours=  $ 150 per unit per machine hour.
Overhead Allocated 
                                          Commercial              Residential
Assembly Department       1.4 *120                   1.1 dmh *120
                                                168                          132
Testing Department             2.8*150                    2.2*150
<u>                                                420                             330                    </u>
<u>Total Overhead per Unit     $ 588                       $  462              </u>
c. ABC approach is better as it gives an estimate of the overhead per unit both for the Commercial and Residential department using the assembly and testing overheads rates separately. The single plant wide rate gives a mere estimate of the overall costs.