a) Under an activity-based costing system, what is the activity cost per unit of activity driver for assembly?b) Under an activity-based costing system, what is the total cost of lounge chairs for the year?

Question 6 Calcarenite Pty Ltd plans to manufacture two lines of chairs in the coming year - lounge and patio. The company is considering introducing an activity-based costing system. Given below are each activity, its cost and its related activity driver. Activity Cost Activity Driver Material setups $150,000 Number of setups Material handling $200,000 Number of parts Cutting $500,000 Number of parts Assembly Direct labour $400,000 hours Finishing $600,000 Number of units The level of activity for the year is: Lounge Patio Units to be produced 12,000 8,000 Number of setups 30 45 Number of parts per unit 20 10 Direct labour hours per 4 unit