Question 2 (15 marks) - Topic 6 Nature Productions manufactures two products the company's products for next year are prov icts. Lightning and Flame. Estir for next year are provided below: Lightning Flame Estimated production volume 4,000 5,000 Direct material cost $25 / unit $30 / unit Direct labour per unit 4 hours @ $8/ hour 3 hours @ $8/ hour The company's estimated overhead of $800,000 activities: material handling ($150,000), ass ($90,000). These activities are driven by 9 hours, and number of inspections respective year are as follows: erhead of $800,000 can be identified with three major ($150,000), assembly ($560,000) and quality control are driven by quantity of materials used (kg), machine ections respectively. Estimated activity levels for the next Lightning Flame Total 60,000 Quantity of material used (kg) 40,000 100,000 Machine hours 36,000 44,000 80,000 Number of Inspections 600 2,400 3,000 Required: a) Assuming that Nature Productions uses activity-based costing to apply overhead to production, calculate the (i) total overhead costs, and (ii) unit manufacturing costs, for Lightning and Flame if the estimated manufacturing volume is achieved. (12 marks) b) Why might organisations choose to implement a one-off activity-based costing project rather than an ongoing system? (3 marks) (12 + 3 = 15 marks)