Ed Co manufacture two exercise machines, the 'Power' and the 'Fit' using the same equipment. Ed Co currently uses a blanket overhead rate to assign overheads to products The finance director would like to introduce an activity-based costing approach to costing product. You have been requested to prepare a report that compares total manufacturing costs using the two different methods. Budgeted data for August Overhead costs for the month totalled 820,000 Fit 360o Power Budgeted number of units 3000 manufactured Direct material cost per unit 240 Direct labour hours per unit 1 Direct labour cost per hour Total machine hours per 4500 product Number of production runs per product Number of purchase orders 04 per product 248 2 2 214 5400 12 54 Activity cost pools Machine activity Production planning Materials handling 510.000 130.000 180.000 Required: a) Calculate the blanket overhead absorption rate per direct labour hour. (3 marks) b) Using the blanket overhead rate calculated in a) above, calculate the total manufacturing cost for each product. (4 marks) c) Using an activity-based costing approach (ABC) calculate the manufacturing cost per one unit of each product. (18 marks) (Total 25 marks)