ACC T20076 T12019 Pn osoft. MicrosoftEdge_awekyb 3d8bbwe/lermpState/Downloads ACCT200mm 002010%20pt Assignment questions Laurie Manufacturing Ltd., manufactures two types of Lawn Mowers, Standard and Deluxe. The company uses simple costing system and the two direct cost categories are materials and labor. It also has one indirect cost pool and allocates indirect costs on the basis of machine hours. Information related to the production in the year 2018 is as follows and the owner is concerned about the decline in the market share for the company's Standard model. Laurie Manufacturing Ltd. Standard Deluxe Units sold 3200 125 S30 1800 Selling price Direct material cost per unit 5200 516 $16 1.50 2.25 Direct manufacturing labor cost per hour Direct manufacturing labor-hours per unit Production runs 85 168 155 5,5004,500 150 40 72 45 Material moves Machine setups Machine hours 250 Number of inspections The owners are interested in using activity-based costing system and would like to understand how this system would affect their product costing decisions. Mr Samuel, the cost accountant identifies production scheduling, material handling. machine setup, inspection and marketing as six activities generating indirect costs, ACCT20076-112019 PrX ta/Loca /Pad ages/Microsoft MicrosoftEdge 8wekyb3d8bln ei mp StateDownl ds/OCT200 70 n%20201 and collects the following data: Activity Production scheduli Material handling Machine set up Assembly Ins Activity Cost Activity Cost Driver Production runs Material moves Machine setups Machine-hours 595000 45,000 $25,000 60,000 $8,000 Number of inspections Marketing costs are determined to be 6% of the sales revenue for each type of mower. REQUIRED: Prepare an Executive Report to advise the owner on the results of an analysis of the simple costing system and ABC system. Your report should include the following: 1. Show your calculations in determining the cost of a Standard Lawn 2. Show your calculations in determining the cost of a Standard Lawn 3. Compare the costs of lawn mowers under simple costing and ABC. Explain 4. Suggest to the owners of Laurie Manufacturing Ltd., how this new Mower and Deluxe Lawn Mower using simple costing system. Mower and Deluxe Lawn Mower using ABC system. to the owner why there is a difference in the use of the two types of tem costing systems. of ABC could help address the declining market share of Standard Lawn mowers THE END