(c) What is the manufacturing cost per armoire under the proposed activity-based casting? (Prepare all of the necessary schedules.) (d) Which of the two costing systems is preferable in pricing decisions and why? Parson Furniture designs and builds factory-made, premium, wood armoires for homes. All are of white cak. Its budgeted manufacturing overhead costs for the year 2017 are as follows Overhead Cost Pools Amount Purchasing 45,000 Handling materials 45,000 Production 130,000 Setting up machines 50,000 Inspecting 60,000 Inventory control 80,000 Utilities 110,000 Total budget overhead costs 520,000 For the last 4 years, Parsen Furniture has been charging overhead to products go tos basis of materials cost. For the year 2017, materials cost of $500,000 were budgeted. Sandy Parson, owner-manager of Parson Furniture, recently directed her accountant, Tim Tank, to implement the activity-based costing system that he has repeatedly proposed. At Sandy Parson's request, Tim and the production foreman identify the following cost drivers and their usage for the previously budgeted overhead cost Estimated Use Cost Pools Cost Drivers of Cost Drivers Purchasing Number of orders Handling materials Number of moves 5,000 Production Direct labor hours 65,000 Setting up machines Number of setups 1,000 inspecting Number of inspections 4,000 Inventory control Number of components 40,000 Square feet occupied 50,000 Jason Sang, sales manager, has received an order for 10 lucury armoires from Sally's Interior Design. At Jason's request, Tim prepares cost estimates for producing components for 10 armoires so Jason can submit a contract price per armour to Sally's. He accumulates the following data for be productions 10 armoires Activity 600 pools. Utilities Direct materials Direct labor Direct labor hours Number of purchase orders Number of material moves Number of machine setups Number of inspections Number of components Instructions: Number of square feet occupied 5,200 3,500 200 3 32 20 640 320 (a) Compute the predetermined overhead rate using traditional costing with materials cast as the basis. (b) What is the manufacturing cost per armoire under traditional casting