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EXHIBIT 5 Manufacturing expenses Cutting Stitching Inspection Packing Total Actual Available minutes 473.922 1.840.981 1.976.590 628.320 4.919.813 Direct expenses(PKR) 3.114.971 3.887.492 6.269.057 1.604.265 14.875.785 Indirect

EXHIBIT 5 Manufacturing expenses
Cutting Stitching Inspection Packing Total
Actual Available minutes 473.922 1.840.981 1.976.590 628.320 4.919.813
Direct expenses(PKR) 3.114.971 3.887.492 6.269.057 1.604.265 14.875.785
Indirect expenses (PKR) 1.891.888 7.349.163,04 7.890.511,73 2.508.242,14 19.639.805
Total Manufacturing Overhead 5.006.859 11.236.655 14.159.568,73 4.112.507,14 34.515.590
Cost per minute 10.56 6.1 7.16 6.55 7.02
QUESTION: Decribe the traditional costing system of Sapphire ( and its weakness). Calculate the cost of the customer orders given in Exhibit 5 of the case using the existing costing system AND WHAT DO YOU RECOMMEND THE COMPANY SHOULD DO?

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