Dexmans's Netballs is a manufacturer of high-quality basketballs and volleyballs. Setup costs are driven by the number of batches. Equipment and maintenance costs increase with the number of machine-hours, and lease rent is paid per square foot. Capacity of the facility is 16000 square feet, and Dexman is using only 60% of this capacity. Dexman records the cost of unused capacity as a separate line item and not as a product cost. The following is the budgeted information for Dexman:

- Data table 203,100 221,490 Dexman's Netballs Budgeted Costs and Activities For the Year Ended December 31, 2017 Direct materials-basketballs $ Direct materials-volleyballs Direct manufacturing labor-basketballs Direct manufacturing labor-volleyballs Setup Equipment and maintenance costs Lease rent 110,600 100,210 187,000 98,800 192,000 $ Total 1,113,200 Print Done Data table Other budget information follows: Basketballs 64,000 14,500 Volleyballs 70,000 11,500 Number of balls Machine-hours Number of setups Square footage of production space used 500 350 3,300 6,300 Print Done Requirements 1. 2. 3. Calculate the budgeted cost per unit of cost driver for each indirect cost pool. What is the budgeted cost of unused capacity? What is the budgeted total cost and the cost per unit of resources used to produce (a) basketballs and (b) volleyballs? Why might excess capacity be beneficial for Dexman? What are some of the issues Dexman should consider before increasing production to use the space? 4. Print Done