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Kramer has 3,000 residential customers and 750 business customers. Required: 1. Compute the cost per customer for residential and business customers for 2021, using the current system of cost allocation. 2. Assume that the 2021 data will hold for 2022. Compute the cost per customer for residential and business customers for 2022 using the proposed system of cost allocation. In doing so, calculate the overhead allocation rate for each activity, and use these rates to assign costs to the two customer groups. 3. Explain the difference between the two cost allocation systems. 4 AA Kramer Office Supplies offers a number of different products to its customers. It currently allocates its ordering and delivery costs to its residential and business customer groups on the basis of order value. However, the company has recently decided to implement activity- based costing starting in 2022 to assign these costs to customers. Key data for 2021 are as follows: Activity Activity Cost Activity Base Activity Volume Residential Activity Volume Business Total Activity Volume Sales (order value) $4,400,000 $3,260,000 $7,660,000 Order processing 960,000 No. of orders 8,000 2,000 10,000 Generating sales 750,000 No. of sales calls 2,000 3,000 5,000 Sales follow-up 810,000 No. of follow-ups 200 400 600 Processing change orders 60.000 No. of change orders 200 300 500 Delivery 1,250,000 No. of deliveries 6,000 4,000 10,000 Total $3,830,000 Kramer has 3,000 residential customers and 750 business customers. Required: 1. Compute the cost per customer for residential and business customers for 2021, using the current system of cost allocation. 2. Assume that the 2021 data will hold for 2022. Compute the cost per customer for residential and business customers for 2022 using the proposed system of cost allocation. In doing so, calculate the overhead allocation rate for each activity, and use these rates to assign costs to the two customer groups. 3. Explain the difference between the two cost allocation systems