MRIs. They are known for having an excellent reputation for accurate results and client service. They have achieved this level of success through the constant review of their processes and analyzing how to improve their services. They currently use a single, facility wide overhead allocation rate. The CFO states that they believe they can make some process improvements by allocating costs using an activity- based costing system. The result would be to segregate the administration, maintenance, sanitation and utilities costs. She thinks ABC costing might be the best way to improve their accounting systems. Use the following budgeted financial information to respond to the questions. X-rays Ultrasound CT Scan MRI Total Labour $46,080 $79,200 $72,000 $78,750 $276,030 Depreciation 24,180 201,000 329,250 673,125 1,227,555 Direct materials 16 560 12,375 18,000 23,438 70,373 Administration 15 458 Maintenance 185 490 Waste disposal 147,135 Utilities 100,763 Totals $86,820 $292,575 $419,250 $775,313 $2,022,803 Other information about the number of procedures and the timeit takes for each procedure: X-rays Ultrasound CT Scan MRI Total Number of procedures 2,880.00 3,300.00 2,250.00 1,875.00 10,305.00 Minutesto dean after each procedure 3.75 3.75 11.25 26.25 45.00 Minutesto perform each procedure 3.75 11.25 15.00 33.75 63.75 The proposed allocation bases for overhead using the new ABC system are as follows: Activity Allocation base Administration Number of procedures Maintenance Depreciation Waste disposal Total cleaning minutes Utilities Total procedure minutes REQUIRED 1. Assume a traditional (simple) costing system that they currently use. What is the budgeted cost per service for X-rays, ultrasounds, CT scans, and MRIs? (4 marks) 2. As per the CFO's proposal, calculate the NEW budgeted cost per service for X-rays, ultrasounds, CT scans, and MRIs if they allocate overhead using an ABC system. (8 marks) 3. How could the new cost allocation be useful for the managers of Samir's Sonography Centre as compared to the old system? (4 marks)