Managerial Accounting question

0 Issue 5: The following information provides details of the costs, volume and cost drivers for a particular period in respect of ABC Ltd, a hypothetical company: Product X Product Y Product Z Total (a) Production and sales (km; 30,000 20,000 8,000 (b) Raw material usage (number of components) 5 5 11 (c) Direct material cost $25 $20 $11 $1,238,000 (d) Direct Whours 11/3 2 1 88,000 (e) Machine hours 11/3 1 2 76,000 (i) Direct 13.139115 cost $8 $12 $6 (g) Number of m runs 3 '7 20 30 (h) Number of deliveries 9 3 20 32 (i) Number of receipts (b x g); 15 35 220 270] (j) Number of production orders 15 10 25 50 (k) Overhead costs: 5 Set-up 30,000 Machines 760,000 Receiving 435,000 Packing 250,000 Engineering 373,000 1,848,000 * The company operates a j ust-in-time inventory policy, and receives each component once per production run. The company currently assigns production overheads to products on the basis of direct Labour hours, but the management accountant has recently attended a training course on activity-based costing and is planning to change to an ABC system. (i) Compute the product costs using the current traditional costing system. (ii) Compute the product costs using an activity-based costing system. (iii) Briey explain the differences between the product cost computations in (i) and (ii) above