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Question 6 (16 Marks) Company designs and builds custom windows for luxury homes. Most of the are custom made but occasionally the company does mass production on order. Its budgeted manufacturing overhead costs for the year 2012 are as follows: Overhead Cost Pools Purchasing Production (cutting, milling, finishing) Setting up machines Inspecting Utilities Total budget overhead costs $ 200,000 675,000 135,000 190,000 1500,000 usan Craft, owner-manager of Sparkling Window, recently directed her accountant to implement activity-based costing system she has repeatedly proposed. At Susan's request, the accountant the and production foreman identify the following cost drivers and their usage for the previously budgeted overbead cost pools. Total Drivers 800 Activity Cost Drivers Number of orders Direct labor hours Number of setups Number of inspections Square feet occupied Purchasing Production (cutting, milling, finishing) Setting up machines 100,000 1,000 7,600 100,000 Utilities During this month, the company received an order for 50 window sets from a housing devel contractor. The accountant so Susan can production of 50 window sets is accumulated: estimates for producing submit a contract price per window set to the contractor. The following data for the components for 50 window sets $125,000 $135,000 12,000 10,000 50 80 380 7,000 Direct labor bours Number of purchase orders Number of machine sctups Number of inspections Number of square feet occupied Instructions (a) Compute the manufacturing cost per window set un der the proposed activity-based costing. Estimated Total Activity-Based Production Setting up machines Inspecting Utilities Expected Activity-Based Purchasing Production Setting up machines Inspecting Utilities Total manufacturing cost per window set under ABC Direct materials Direct labor Overhend Total cost of 50 window sets Total cost per window set: Bonus: (3 marks) Corris Co. accumulates the following data concerning a mixed cost, using miles as the activi level Miles Driven Total Cos $17,000 13,500 14,400 12,500 10,000 January February8,000 March April 9,000 7,000 Instructions Compute the variable and ixed cost elements using the high-low method