Come-on-In Manufacturing produces two types of entry doors: deluxe and standard. The assignment basis for support costs has been direct labour dollars. For 2008, Come-On-In compiled the following data for the two products: Deluxe Standard -------------------------------------------------------------------------------- Sales units 50,000 400,000 Sales price per unit $650 $475 Direct materials and labour costs per unit $180 $130 Manufacturing support costs per unit $80 $113.75 Last year, Come-on-In Manufacturing purchased an expensive robotics system to allow for more decorative door products in the deluxe product line. The CFO suggested that an ABC analysis could be valuable to help evaluate a product mix and promotion strategy for the next sales campaign. She obtained the following ABC information for 2008: Activity Cost Driver Cost Total Deluxe Standard -------------------------------------------------------------------------------- Set-ups # of setups $500,000 500 400 100 Machine-related* # of machine-hours $44,000,000 600,000 300,000 300,000 Packing # of shipments $5,000,000 250,000 50,000 200,000 *These costs relate mainly to amortization of equipment. Required: a. Using the current system, state each of the following: 1.estimated total cost of manufacturing one unit for each type of door (1 mark) 2.estimated profit per unit for each type of door (1 mark) b. Using the current system, estimated manufacturing overhead costs per unit are less for the deluxe door than for the standard door. What is a likely explanation for this? (2 marks) c. Review the machine-related costs above. What is a likely explanation for machine-related costs being so high? What might explain why machine-hours for the deluxe doors are the same as for the standard doors? (2 marks) d. Using the activity-based costing data presented above, 1.compute the cost driver for each overhead activity. (2 marks) 2.compute the revised manufacturing overhead cost per unit for each type of entry door. (2 marks) 3.compute the revised total cost to manufacture one unit of each type of entry door. (2 marks) 4.compute the profit per unit and in total for each type of entry door. (2 marks) e. Is the deluxe door as profitable as the original data estimated? Why or why not