• MEMENTO Ltd, manufactures two products AA and BB. Each has two components specified as sequentially numbered parts ie, product AA (parts A1 and A2) and product BB (Parts B1 and B2). Two production departments namely machinery and assembly are supported by five services activities. Additional information is as follows: Product No: AA Product No: BB Production details: Components Part Part Al A2 Part BI Part B2 Annual Volume produced each component (Units) Annual Direct Labour hours: (DLH) Machinery Department (MD) Assembly Department (AD) 75,000 125,000 Overhead Cost Analysis Rs. Material handling Material purchasing Set-up 75,000 Maintenance 225,000 80,000 Quality Assurance Machinery- MD (Machinery power, depreciation, etc.) Assembly-AD (Machine, depreciation, power, etc.) 275,000 225,000 1,400,000 i. ii Cost of all activities are fairly independent. . Cost of depreciation and cost of power are primarily production volume driven and direct labor hours are an appropriate surrogate measure of this. Annual Cost Driver Volume per Component Part A2 Cost Driver Part Al Part B1 Part B2 Material movements 360 640 1,200 600 Number of orders 500 900 1300 1,800 Number of set-up 50 100 150 300 Maintenance Hours 3,000 1,000 2,000 4,000 Number of inspections 200 300 500 1,000 Direct labour hours (MD) 75,000 125,000 200,000 100,000 Direct labour hours (AD) 50,000 25,000 40,000 85,000 You are required to compute the unit costs for products AA and BB using A traditional volume-based product costing system and b. An activity-based costing system.