Makki Company manufactured single product called a mono-relay. Then three years ago, the company automated a portion of its plant and at the same time introduced a second product called a bi-relay. The bi-relay has become increasingly popular and the company is now producing 10,000 units of it each year as compared to 40,000 units of the mono-relay. The bi-relay is a more complex product, requiring 1 machine hour per unit to manufacture while the mono-relay requires only 0.75 machine hours per unit. Mono- requires 2 labour hours while bi-relay requires 1.25 labour hours to finish. Overhead costs are assigned to products on a basis of machine hours. Despite the popularity of the company's new bi-relay, profits have declined steadily since a portion of the plant was automated, Management is beginning to believe that a problem may exist with the company's costing system, unit cost for the materials and labor for the two products follow Direct Material Mono-Relay Rs 40 +Reg# Bi-Relay Rs 50+Reg# @ Rs12/hr @ Rs.12/hr Direct Labor For 2013 the current year, the company estimates that it will incur Rs. 10,00,000 in overhead costs and produced units of the two relays as stated above, the company charges sales price per unit calculated as cost+10% Required(A)Using this rate and other data from the problem, determine the cost to manufacture one unit of each product and sale price per unit under this method Assume that the company's overhead costs can be traced to four centers. These activity centers, their cost drivers, and estimated data relating to each center for 2013 are given below Activity center and cost driver Parts inventory(no of parts) Purchase order (no of orders) Quality control(no of tests) Machine related (machine hours) Traceable costs Total Mono-relay Bi-relay Rs 180,000+ Reg # 225 75 150 90,000+Reg# 1000 800 200 230,000+Reg# 5750 2500 3250 500,000+ Reg# 10,000 4000 6000 Required(B) Calculate cost and sale price per unit using activity-based costing for two products and discuss the problem by company units costs and sale prices calculated under both of the methods