\fIndirect labor [and fringe benetsl $ 28,DU{J Information technology 10,D{]D Machineryrelated costs 12,005! Energy 2 DUB Total $ 523000 Then, Helga began a series of interviews with department heads to see how to assign these costs to cost pools. She foimd that onehalf of indirect labor was for scheduling or for handling production runs, including purchasing, preparing the production run, releasing materials for the production run, and performing a firsttime inspection of the run. Another 40 percent of indirect labor was used to set up machinery to produce a particular product. The time to set up the products varied. The renisining 10 percent of indirect labor was spent maintaining records for each of the four products, monitoring the suppljg.r of raw materials required for each product, and improving the production processes for each product. Interviews with people in the Information Technology Department indicated that eighty percent of the information technology cost was for scheduling production runs. Twentyr percent of the cost was for recordkeeping for each of the four products. The rest of the overhead was used to supply machine capacityr of 10,000 hours of productive time. Helga found the following cost driver voiumes from interviews with production personnel. I Setups: 56E} person hours doing setups I Production runs: 1 10 production runs I Machinehour capacity: 10,000 hours I Recordkeeping costs are estimated to be roughly equivalent for each of the four products. In addition, Helga learned that production people had difculty getting the taste just right for the Mint and Almond colas, so Mint and Alnlond colas required more time per setup than either Diet or Regular cola. did. She suuunarized her findings on cost driver volumes below. Diet Regular Mint Almond Total Setup hours 200 60 24C! 60 SEE] Production runs 4U 30 3C! 10 1 10 Total machine hours 5,000 4,000 QUE! 100 10,0013 Answer the following questions. 1. Compute cost unit costs for each product under the current system. 2. Compute unit costs for each product using the activitybased costing [ABC] data provided. 3. Prepare 2 critical recomnlendations to Bertie based on the information you have gathered. Justify the recomnlendations, and state why these are critical in your opinion. 4. Continue to assume that practical capacity is 20,000 machine hours. Botts has been approached by Aberforth Dumbledore, the owner of the [calqr Cauldron {a popular and innovative bar}, regarding a onetime order of Butterbeer cola, which Durnbledore had developed himself. Based on his market research, Dunlbledore expects that Butterbeer cola would be in high demand in Botts Eottling's nlarket, and he projects sales of anywhere between 30,000 to 50,000 bottles in the coming year. He describes the process of producing Butterbeer, and based on his description, Botts estimates that it would take 0.10 hours to produce each unit of Butterbeer. {Recall that the machine capacity in this case is 20,000 hours, while Diet, Regular, Mint, and Almond consume only 10,000 hours] Botts also estimates that Butterbeer cola's perunit costs would be identical to those of Diet cola except for the machine usage costs. Dumbledore is unsure of the potential of Butterbeer to sell beyond the coming year, because of the novelty of the product. a. What would be minimum unit price that Botts would be wiing to accept from Dmnbledore to produce Butterbeer? b. What other factors must Botts consider in deciding whether to accept this special order