5-16 Cost hierarchy. Forester, Inc., manufactures karaoke machines for several well-known companies. The machine differ significantly in their complexity and their manufacturing batch sies. The following costs were incurred in 2014. a. indirect manufacturing labor costs such as supervision that supports direct manufacturing labor, $825,000. b Procureent costs of placing purchases orders, receiving materials, and paying suppliers related to the number of purchase orders placed, $525,000 c. cost of indirect materials, $160,000 d. cost incurred to set up machines $365,000 e. designing processes, drawing process charts, and making engineering process changes for products $287,500 f. Machine related overhead costs such as depreciation, maintenance and production engineering $950,000 g. Plant management, plant rent and plant insurance $512,000 1. classify each of the preceding costs as output unit-level, product-sustaining, or facility-sustaining. Explain each answer 2. Consider two types of karaoke machine made by Forrester, inc., one machine design for professional use, is complex to make and is produced in many batches. The other machine, designed for home use, is simple to make and is produced a few batches. Supposed that Forrester needs the same number of machine hours to make each batch of karaoke machine and that Forrester allocates all overhead costs using machine hours as the only allocation base. How if at all, would the machines be miscounted? Briefly explain why. 3 How is the cost hierarchy helpful to Forrester in managing its business?