CBI prices its coffee at full product cost, including allocated overhead, plus a markup of 30%. If its prices are significantly higher than the market, CBI lowers its prices. The company competes primarily on the quality of its products, but customers are price conscious as well. Data for the current budget Include factory overhead of $3,266,000, which has been allocated on the basis of each product's direct labor cost. The budgeted direct labor cost for the current year totals $600,000. The firm budgeted $6,000,000 for purchase and use of direct materials (mostly coffee beans). The budgeted direct costs for 1-pound bags are as follows: Direct materials Direct labor Mona Loa $4.20 0.30 Malaysian $3.20 0.30 CBI's controller, Mona Clin, believes that its current product costing system could be providing misleading cost Information. She has developed this analysis of the current year's budgeted factory overhead costs: Activity Purchasing Materials handling Quality control Roasting Blending Packaging Total factory overhead cost Cost Driver Budgeted Driver Consumption Budgeted Cost Purchase orders Setups 1,348 1,990 $ 674,000 796,000 Batches 910 182,000 Roasting hours 98,000 980,000 Blending hours Packaging hours 35,500 27,900 355,000 279,000 $ 3,266,000 Data regarding the current year's production for the Mona Loa and Malaysian lines follow. There is no beginning or ending direct materials Inventory for either of these coffees. Budgeted sales Batch size Setups Purchase order size Roasting time Blending time Packaging time Mona Loa 100,000 pounds 10,000 pounds 3 per batch 25,000 pounds 1 hour per 100 pounds 0.5 hour per 100 pounds 0.1 hour per 100 pounds Malaysian 2,000 pounds 500 pounds 3 per batch 500 pounds 1 hour per 100 pounds 0.5 hour per 100 pounds 0.1 hour per 100 pounds Coffee Bean has total practical capacity as noted in the table below, I.e. processing 1,780 purchase orders, 2,780 setups, etc. These are the levels of activity work that are sustainable. Activity Practical Capacity Purchasing 1,780 Materials handling 2,780 Quality control 1,580 Roasting 103,800 Blending Packaging 39,800 33,800 Required: 1. Determine the activity rates based on practical capacity and the cost of idle capacity for each activity. (Round "Usage %" and "Practical Capactity Rate" to 2 decimal places. For percentages .1234 = 12.34%.) Activity Budgeted Activity Budgeted Cost Usage Based Rate Practical Capacity at Current Usage % Practical Capacity Rate Unused Capacity Idle Capacity Cost Spending Purchasing 1,348 $ 674,000 1,780 Materials handling 1,990 $ 796,000 2,780 Quality control 910 $ 182,000 1,580 Roasting 98,000 $ 980,000 103,800 Blending 35,500 $ 355,000 39,800 Packaging 27,900 $ 279,000 33,800 $ 3,266,000 $ 0