Question 1: (5 Marks) The Aseel Co. produces 3 products, A, B and C. All are made from the same materials. The company used to use the traditional absorption costing. The company now want to consider the activity-based costing system in order to improve the profitability. The Information for the three products are as following; A B C Production and sales volumes (units) Selling price per unit (OMR) Raw material usage (Kg) per unit 15,000 12,000 18,000 7.500 12 13 2 3 4 Direct labor hours per unit 0.1 0.15 0.2 Machine hours per unit 0.5 0.7 0.9 Number of productions runs per year 16 12 8 Number of purchase orders per year 24 28 42 Number of deliveries to retailers per year 48 30 62 The price of the raw material remains constant throughout the year at OMR 1.200 per Kg. Similarly, the direct labor cost for the whole workers is OMR 14.00 per hour. The annual overhead cost will be as following; OVERHEADS Machine Setup costs Machine running costs Procurement Costs Delivery Costs OMR 26,550 66,400 48,000 54,320 Required: (a) Calculate the full cost per unit for products A, B and C under traditional absorption costing, using direct labor hours as the basis for apportionment. (b) Calculate the full cost per unit of each product using activity-based costing.