QUESTION 4 Minecraft Sdn. Bhd. is a local manufacturing company of video games. Currently the company employs traditional costing system to allocate its overhead to products. However, after attending workshop on costing system, senior manager of the company has proposed of changing the system to ABC costing system Details of the games and relevant information are given below for one period Product GAMED GAMEZ GAMES Output in units 12.000 10.000 8.000 Costs per unit: RM RM RM Direct material 4 5 Direct labor 19 21 24 Machine hours (per unit) 1 hour 1.5 hours 1 hour Continued... BACIS The production overhead is currently absorbed by weg a machine hour rate, and the total of the production overhead for the period has been analyzed as follows: Overhead costs RM Machine department costs (rent, business rates depreciation and supervision) 61.100 Se-up costs 12.000 Stores receiving 14.000 Inspection quality control 14.500 Materials handling and dispatch 22.400 124.00 Based on the information gathered, cost drivers and the elemes identified for the overhead costs are as follows: Cest Cost Driver Machine costs Machine hours Set-up costs Number of set-ups Stores receiving Requisition raised Inspection Quality control Number of inspections Materials handling and dispatch Materials movements The following cost driver volumes were recorded for the products Product GAMEI GAMEZ GAMES TOTAL Machine hours 12.000 15.000 8.000 35.000 No. of sct-ups 10 15 15 40 Requisitions raised 4 30 20 No. of inspections 10 15 20 45 Material movements 110 200 Required: (a) Calculate the overhead cost per unit of each product under the present cost accounting system (6 marks) b) Calculate the estimated total cost per unit of cach product if activity-based costing is used. (19 marks)