Please answer Required 3 and 4 only.
During this period of pandemic crisis PT Maskerindo Covidiana (PTMC) produces two types of masks, Masker Bedah (MasBed) and Masker Kaen 95. The company's simple costing system has two direct cost categories (materials and labor) and one indirect cost pool. The simple costing system allocates indirect costs on the basis of machine hours. Recently, the owners of PTMC have been concerned about the fierce competition in the market and the market share for their mask products. Information related to PTMC production for the most recent year is as follows: MasBed 6.400 Kaen 95 3.600 Rp 250.000 Rp60.000 Rp32.000 1,5 Hours Rp400.000 Rp90.000 Rp32.000 2,25 Hours Units produced and sold (in lots) Selling price per lot Direct material cost per lot Direct manufacturing labor cost per hour Direct manufacturing labor hours per lot Other activities related to production Production runs Material moves Machine setups Machine hours Number of inspections 80 144 90 11.000 500 170 336 310 9.000 300 The owners have heard of other companies in the industry that are now using an activity-based costing system and are curious how an ABC system would affect their product costing decisions. After analyzing the indirect cost pool for PTMC, five activities were identified as generating indirect costs: production scheduling, material handling, machine setup, assembly, and inspection. PTMC collected the following data related to the indirect cost activities: Activity Production scheduling Material handling Machine setup Assembly Inspection Activity Cost Activity Cost Driver Rp190.000.000 Production runs Rp90.000.000 Material moves Rp50.000.000 Machine setups Rp120.000.000 Direct labor hours Rp16.000.000 Number of inspections Required: 1. Calculate the cost of 1 lot of MasBed and Kaen95 masks under the existing simple costing system. Round your answer to the nearest Rupiah. (8%) 2. Calculate the cost of 1 lot of MasBed and Kaen95 masks under the activity-based costing system. Round your answer to the nearest Rupiah. (12%) 3. Compare the cost and margin of the masks in requirements 1 and 2. Explain why the simple and activity-based costing systems have different costs of each mask. (2,5%) 4. Based on the information given and analysis in 1-3, as a manager/director of marketing of PTMC, what will you do or decide to improve the company's performance facing the competition. (2,5%) During this period of pandemic crisis PT Maskerindo Covidiana (PTMC) produces two types of masks, Masker Bedah (MasBed) and Masker Kaen 95. The company's simple costing system has two direct cost categories (materials and labor) and one indirect cost pool. The simple costing system allocates indirect costs on the basis of machine hours. Recently, the owners of PTMC have been concerned about the fierce competition in the market and the market share for their mask products. Information related to PTMC production for the most recent year is as follows: MasBed 6.400 Kaen 95 3.600 Rp 250.000 Rp60.000 Rp32.000 1,5 Hours Rp400.000 Rp90.000 Rp32.000 2,25 Hours Units produced and sold (in lots) Selling price per lot Direct material cost per lot Direct manufacturing labor cost per hour Direct manufacturing labor hours per lot Other activities related to production Production runs Material moves Machine setups Machine hours Number of inspections 80 144 90 11.000 500 170 336 310 9.000 300 The owners have heard of other companies in the industry that are now using an activity-based costing system and are curious how an ABC system would affect their product costing decisions. After analyzing the indirect cost pool for PTMC, five activities were identified as generating indirect costs: production scheduling, material handling, machine setup, assembly, and inspection. PTMC collected the following data related to the indirect cost activities: Activity Production scheduling Material handling Machine setup Assembly Inspection Activity Cost Activity Cost Driver Rp190.000.000 Production runs Rp90.000.000 Material moves Rp50.000.000 Machine setups Rp120.000.000 Direct labor hours Rp16.000.000 Number of inspections Required: 1. Calculate the cost of 1 lot of MasBed and Kaen95 masks under the existing simple costing system. Round your answer to the nearest Rupiah. (8%) 2. Calculate the cost of 1 lot of MasBed and Kaen95 masks under the activity-based costing system. Round your answer to the nearest Rupiah. (12%) 3. Compare the cost and margin of the masks in requirements 1 and 2. Explain why the simple and activity-based costing systems have different costs of each mask. (2,5%) 4. Based on the information given and analysis in 1-3, as a manager/director of marketing of PTMC, what will you do or decide to improve the company's performance facing the competition. (2,5%)
