calculate the overhead cost per unit, using

6.1 the traditional costing system approach

6.2 the activity based costing approach

QUESTION 6 (15 MARKS, 27 MINUTES) Robbin Limited, a newly established manufacturing company in the Southern Industrial area, manufactures two types of Boardroom Tables. One type of these Boardroom tables is sold locally and the other type is exported to Angola. While the designs are identical, the material used is different to cater for the different climatic conditions of the market segments. 2020, the company has budgeted to manufacture 60 000 Boardroom Tables for the local market and 40 000 The two products are produced with the same equipment and they utilise the same overhead resources. In Boardroom Tables for export to Angola. The manufacturing is done in batches of 1 000 Boardroom Tables each other details of the company's activities, inputs and outputs are as follows: Analysis of overhead costs Material handling Material procurement Machine set-up Quality control Production Depreciation TOTAL N$ 200 000 N$ 40 000 N$ 180 000 N$ 270 000 N$ 610 000 N$ 200 000 N$ 1 500 000 Analysis of cost drivers Local Export 60 Cost driver Material movements Overhead Material handling 100 200 200 Number of orders Material procurement 1 1 Number of set-ups / batch Machine set-ups 150 100 Number of inspections Quality control 3 5 Machine hours / unit Machine hours / unit 0.75 0.50 Direct labour hours / unit Production The company management has been using the "traditional costing approach" to allocate overheads betwee the two products, with direct labour hours as allocation base. They are thinking of applying the Activity-Base Costing System 6