Grains-R-Us makes several types of breakfast products. The company currently allocates overhead based on direct material cost and uses normal costing.

Instead of just giving the answer, would be great if you can explain how to do it/why.

b. What is the total cost of Cereal production in 2017?

c. The firms Waffle manager believes that the amount of overhead allocated to her division is too high and the current allocation base is inappropriate. If she wants to minimize the total cost of Waffle production, which allocation base should she find most desirable? Explain.

d. If the firm uses the allocation base you indicated in part (c), would this increase, decrease, or have no effect on the firms total profit? If there is not enough information to answer this question, explain why not.

f. What is the total cost of Cereal production using activity-based costing?

1. Grains-R-Us makes several types of breakfast products. The company currently allocates overhead based on direct material cost and uses normal costing. Information for 2017 is as follows: Overhead costs Direct labor costs Direct labor hours Direct material costs $2,000,000 $800,000 80,000 $1,600,000 Two of the products that the firm manufactures are cereal and waffles. Information for cereal and waffles is as follows: Direct labor costs Direct labor hours Direct material costs Cereal $200,000 10,000 $250,000 Waffles $60,000 5,000 $300,000 a. Which product does the firm allocate more overhead to in 2017? Justify your answer. CHOOSE ONE: CEREAL WAFFLES SAME FOR BOTH The firm is considering implementing an activity-based costing system to improve the accuracy of its cost estimates. It estimates that the $2 million in total overhead costs consist of the following activities: Activity Inspections Production scheduling Customization Total Overhead costs $1,000,000 $800,000 $200,000 $2,000,000 Activity levels 200 inspections 500 shifts 20 custom orders Activity levels for Cereal and Waffles are as follows: Inspections Production scheduling Customization Cereal 10 inspections 40 shifts O custom orders Waffles 15 inspections 20 shifts 2 custom orders e. What are the allocation (activity) rates for inspections, production scheduling, and customization