Crane Inc. is a distributor and processor of a variety.' of different blends of coffee. The company buys coffee beans from around the world and roasts, blends, and packages them for resale. Crane Inc. currently offers 10 different coffees in 500gram bags to gourmet shops. The major cost is raw materials; however, there is a substantial amount of manufacturing overhead in the mostly automated roasting and packing process. The company uses relatively little direct labour. Some of the coffees are very popular and sell in large volumes, while a few of the newer blends have very lowvolumes. Crane Inc. prices its coffee at total product costs, including allocated overhead, plus a markup of 25%. It prices for certain coffees are signicantly higher than market, the prices are adjusted lower. Data for the 2022 budget include manufacturing overhead of $4.3 million, which has been allocated in the existing costing system based on each product's budgeted direct labour cost. The budgeted direct labour cost for 2022 totals $860,000. Purchases and use of materials [mostly coffee beans} are budgeted to total $7 million. The budgeted prime costs for 500-gram bags of two of the company's products are as follows: Direct materials $3.20 $2.30 Direct labour $0.25 $0.25 Data for the 2022 production of Mocha and Vanilla coffee are as follows. There will be no beginning or ending materials inventory for either of these coffees. Expected sales 50,000 kilograms 1,000 kilograms Batch size 50,000 kilograms 250 kilograms Setups 3 per batch 3 per batch Purchase order size 12,500 kilograms 250 kilograms Roasting time 1 hourf50 kg 1.00 hour150 kg Blendingtime 0.50 hourf50 kg 0.50 bout/50 kg Packaging time 0.10 hourf50 kg 0.10 bout/50 kg Crane's controller believes the traditional costing system may be providing misleading cost information. He has developed an activity based analysis of the 2022 budgeted manufacturing overhead costs shown in the following table: Pu rchasi rig Purchase orders 1,400 $ 700,000 Material handling Setups 2,200 748,000 Quality control Batches 600 180,000 Roasting Roasting hours 122,000 1,220,000 Blending Blending hours 28,200 564,000 Packaging Packaging hours 37,000 925,000 Total manufacturing overhead cost $ 4,337,000 Your Answer Correct Answer (Used) Your answer is partially correct. Calculate the company's 2022 budgeted manufacturing overhead rate using direct labour costs as the single rate and the 2022 budgeted costs and selling prices of 500 grams of Mocha coffee and 500 grams of Vanilla coffee. (Round intermediate calculations and final answers to 2 decimal places, e.g. 15.25.) Overhead rate 5 % of direct labour cost Mocha Vanilla Selling price $ 5.88 5.38 eTextbook and Media Solution Attempts: 3 of 3 used Using multiple attempts has impacted your score. 10% score reduction after attempt 2(b) Your answer is incorrect. Use the controller's activity-based approach to estimate the 2022 budgeted cost for one kilogram of Mocha coffee and one kilogram of Vanilla coffee. (Round intermediate calculations and final answers to 3 decimal places, e.g. 15.258.) Mocha Vanilla Budgeted cost for one kilogram $ $ eTextbook and Media Save for Later Attempts: 1 of 3 used Submit Answer Using multiple attempts will impact your score. 10% score reduction after attempt 2