Asterix Ltd. manufacture electro-mechanical widgets in two model types Standard and Deluxe. Each model requires the use of a difficult to handle component JX3. You are given the following information Direct material cost per unit Machine set-ups per unit Quality control checks per unit Component JX3 per unit Fixed overhead costs per annum total 714,000, and Asterix absorbs these into the product cost in proportion to labour cost. Price is calculated by marking-up the imputed full cost of the Standard by 30%, and the Deluxe by 35% (to gain better margin on their 'luxury' product). A. Calculate the price, and imputed profit margin (%) of both models. 4 Upon analysis, the annual fixed overhead costs can be broken into the following categories Machine set-ups Q.C. department: Special part handling Remaining overheads: 340,000 As Operations Engineer at Asterix, you have suggested imputing full product cost by using ABC principles where possible, as a more accurate costing system. You have been asked therefore to investigate the profit margin on each model (at its current price) using this methodology. In the absence of any other information, you decide to allocate the overheads, where possible, in proportion to their cost drivers per product, and to allocate the remaining overheads using the current absorption costing process B. write a report to Management, (i) illustrating your calculations, (ii) showing the profit margin comparisons 'Absorption' - 'ABC', and (iii) explaining why the difference in margins occurs