Question 4 Coops manufacture briefcases. Two models are produced. The Normal and the Superior. The company has implemented Activity Based Costing (ABC) and operates on a normal costing system. The following information is at your disposal: Activity Cost driver Budgeted Activity Cost for Cost driver levels Budgeted Actual Cost Cost Drivers Drivers per model in November the year for the year Set up Assembly Inspection 105,000 Number of set ups 420,000 Number of assembly hours 10,000 Number of inspections 30.000 70,000 20,000 Normal Superior 1.000 1,500 2.800 3.000 600 1,000 Other Information for November: Actual Manufacturing Overheads for the company came to 45.000 The actual cost of Direct Materials used for the Normal Model came 10.500 to and for the Superior model came to 11.000 Actual Direct Labour Cost for the Normal Model came to 12.000 and for the Superior model came to 12.500 Required: a) Compute the Total Applied Manufacturing Overhead Cost for the Normal and the Superior models in November as well as the Total Applied for the company in November. (45%) b) Compute the total product cost of the Normal and the Superior models in November. (25%) c) Calculate the variance for November and explain what type of variance it is and how it will be treated. (5%) d) Should companies implement ABC since it provides a more accurate allocation of the manufacturing overhead costs Justify your answer. (25%)