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E 12 Logan is a speciest sports car manufacturer with a variety of modes in ts cange The company about to launch the Logan
E 12 Logan is a speciest sports car manufacturer with a variety of modes in ts cange The company about to launch the Logan xoc a special edition sports roadster Production of the Logan XX will be amited to 1,000 cars The trial controler has calculated that direct costs for each Logan XX wil be Materials 9,500 Labour-5,000 He has also analysed the company's total forecast annual overheads as follows Note Cost driver 4,630,000 Machine hours 1,080,000 No of deliveries 720,000 Distance travelled in Production Ine #1 Transportation-deliveries #2 Transportation-distance 83 Total 6,430,000 Note #1 The production line is used for al Logan models and has a full working capacity of 60,000 machine hours The production time taken for Logan XXX will be 14 machine hours per car Note #2 All cars are delivered to showrooms on transporters, which make 6,400 deliveries per year. Note #3 The transporters travel a total of 225,000 kms Within this total, the company expects each Logan XX delivery to average 100 km Q3(a). Calculate the cost driver rate for each of the production line and transportation overheads. (3 marks) Q3(b). Calculate the overhead costs which would be allocated to each Logan XX car using activity-based costing principles. (3 marks) Q3(c). Confirm the total cost of producing and delivering a Logan XX car, including the overhead allocations you calculated in part (b). (2 marks) Q3(d). Give one advantage and one disadvantage of using Activity Based Costing. (2 marks) Fill in your answer here BIUK
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