QUESTION 2 (25 marks) You are given the following budgeted information for Cobblers Ltd. for the next year. Direct wages 54,000 Direct materials 45,000 Depreciation 8,000 Indirect salaries 20,000 Rent & insurance 9,000 Electricity 5,000 Hours Machine hours 21,000 Direct labour hours 9,000 a) Using the above information, calculate the full cost of Job X3. Job X3 uses 20 in materials, 4 hours direct labour and 3 hours of machine time. (7 marks) "Page 2 of 5 b) Explain, with examples, direct costs and indirect costs. (3 marks) c) When calculating an Overhead Absorption Rate, discuss when direct labour hours, machine hours, and units are used. (4 marks) d) Discuss how the above method of Traditional Absorption costing, using a factory wide overhead rate, could be made more accurate, and the problems with this approach. (6 marks) e) What are the differences in approach and use of the Traditional method and the ABC method of costing? (5 marks)