Kidsjoy Ltd specializes in the production of robotic toys. The company started in 2012 and has performed soundly over the last ten years. However, in the past two years, the robotic toy making industry has become very competitive and in recent months, Kidsjoy Ltd has started to notice a steady decline in its monthly profit.

Mr. Smith, CFO of Kidsjoy Ltd, was particularly surprised as Kidsjoy Ltd has historically always enjoyed a sizeable share of the market in robotic toy manufacture [as highlighted in the table below] which allows the company to use a pricing strategy of marking-up their products on average 50% of the costs in the past ten years.

Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Market 33% 36% 41% 4294 43% 40% 36% 339 share in the robotic toy industrysystem, Mr. Smith allocates overhead costs based on the number of robotic toys manufactured: RoboDog RoboBird Total Number of robotic toys manufactured 2600 2000 4600 Direct Materials 126,000 96.000 222,000 Direct Labour 86,000 72.000 158,000 Manufacturing Overhead Cost Applied 221,000 170,000 391,000 Total Manufacturing Cost 433.000 $338.000 $771.000 Cost per robotic toy $166.54 $169.00 Sales price of the robotic toy using a 50% mark-up of cost $249.81 $253.5 In the month of March 2021, the following ABC information is gathered. The following resource-related information for ABC is collected: Quantity of Resources S Resource Drivers Resource Driver Electricity 86.000 # Kilowatt hours 122,857 (kwh) Salaries: Employees 108.000 # Employees 30 Salaries: R&D 9,000 # R& D employees 3 Employees Moulding Machine 150.000 # Moulding hours 15,000 Depreciation Assembly Machine 60.000 # Assembly hours 3.000 Depreciation Workstations 12.000 # Workstations 6 Marketing 8.000 # Advertisements 433,000For each activity pool, the consumption of resources and the respective activity drivers are presented in the table below: Activities Resources Consumed Activity Drivers Research and I workstation Development 2000 kwh # Now functions 3 R& D employees Setup Machines 5 workstations 2 Employees # Machine setups 15,000 moulding hours Moulding 88000 kwh # Moulded Batches 20 Employees 3000 Assembly hours Assembly 32857 kwh # Robots 2 Employees Advertising 4 Advertisements 6 Employees # Advertisements The quantity of activity drivers consumed by RoboDog and RoboBird is presented below: Quantity of Activity Drivers RoboDog RoboBird Total Number of new functions 15 Number of machines set ups 20 16 36 Number of moulded batches 12 30 Number of robots 2600 2000 4600 Number of advertisements 3 4