Papaya Bags PBis designer othigh quality beckpacks and purses. Each deson is made in small batches Each spring PB comes out with new designs or he backpack and orthe purse. The company uses hese designs year and then moves on to the next trend. The bags are all made on th? Sam abrication equipment that is expected to operate at capacity The equipment must be switched over to a new design and set up to prepare for the production of each new batch of products. When completed each batch of products is immediately shipped to a wholesaler. Shipping costs vary with the number of shipments. Budgeted information for the year is as follows EE(Click the icon to visw the budgeled information.) Read the requirements. Data Table Requirement 1. ldenlify the cost hieraicy level for each cust calegury Papaya Bags Budget for Costs and Activities For the Year Ended February 28, 2014 Requirements Cost Cost Hierarchy Level Direct malcrials purses Direct malcrials backpacks Direct labor- purses Direct labor-backpacks Setup Shipping Design Plant utilities and administration Direct meterials-purses Direct materials-backpacks Direct manufacturing labor-purses $ 396,000 442,500 115,200 115,050 163,200 74,000 169,000 216,000 $1,691,910 1. Identify the cost hierarchy level for each cost calegory 2. Idcntily the most approriate cost driver for each cost catcgory. Explain bricfly your choicc of cost drve 3. Calcuate the hudgeted cost per unit of cost driver for each cost category 4. Calculate the budgcted total costs and cost per unit ter cach prcduct line 5. Explain how you could use the information in requirement 4 to reduce costs Selup Shippirig Design Plant utilitigs and adninistration Tola Print Done Choose from any drop-down list and then click Check Answer Other budgel informaliorn follows. Backpacks Purses Total 14 reamaining Clear AI Number of bags 5,900 3,600 9,500 v