Question 2: Hamza incorporation manufactures a single product a commercial filing cabinet that it sell to office furniture distributors. The company is using a single ABC system that it uses for Please turn over Page 1 of 3 Continued From Overleaf internal decision making. The company has two overheads departments whose costs are listed below. Selling and Administrative overhead Manufacturing overhead $400,000 $450,000 Total overhead cost $850.000 The company's ABC system has the following activity cost pools and activity measures: Activity Cost Pool Activity Measure The company's ABC system has the following activity cost pools and activity measures: Activity Measure Number of units Activity Cost Pool Assembling units Processing orders Supporting customers Number of orders Number of customers Others Not applicable Costs assigned to the "Other activity cost pool have no activity measure; they consist of the costs of unused capacity and organization-sustaining costs neither of which are assigned to orders, customers, or the product. Umair Corporation distributes the costs of manufacturing overhead and selling and administrative overhead to the activity cost pools based on employee interviews, the results of which are reported below: Distribution of Resource Consumption Across Activity Cost Pool Assembling Processing Supporting Others Total units orders customers 25% 10% 10% 100% 40% 20% 25% 100% Manufacturing overhead 55% Selling and Administrative overhead 15% Total Activity 500 units 110 orders 91 customers 110 orders Total Activity 500 units 91 customers Required: 1 ii. Perform the first stage allocation of overhead costs to the activity cost pools. Compute activity rates for the activity cost pools. Office Mart is one of Fazal Corporation's customers. Last year, Office Mart ordered filing cabinets four different times. Office Mart ordered a total of 80 filing cabinets during the year. The selling price of a filing cabinet is $595. The cost of direct materials is $180 per filing cabinet, and direct labour is $50 per filing cabinet. What is the customer margin of Office-Mart? (10 Marks)