Required to calculate manufacturing cost of model A and model B under the traditional approach using machine hour for allocating manufacturing overheads

d View. Enable Editing Question 2 (30 marks) AUSScreen is a growing television manufacturer in Australia. The company has two main products: Model A (since 2015) and Model B (introduced in 2020). Unit selling prices for Model A and Model B are $1,125 and $1.425, respectively. The company's CEO, Ferdinand Henry, recommended that the company should focus its marketing resources on Model B while considering phasing out Model A. The company has used a traditional costing system as a basis for pricing decisions. The following cost information was used over the past year: Model A Model B Direct materials per unit 5:260 3730 Direct labour hours per unit # Machine hours per unit Unita produced 27.500 5,000 Hourly wage for direct labour is $15 per hour. Manufacturing overhead costs were estimated at $6.000,000 and were allocated on the basis of machine hours. The financial controller, Daniel Nguyen, recommended that the company should employ activity-based costing analysis to obtain a better picture of the true manufacturing costs of the two models. He collected the following data: Activity Activity driver Estimated costs Soldering number of solder joints $1,177,300 Shipments number of shipments $1,075,000 Quality control number inspections $1,550,000 Purchase orders number of orders $1,188,000 Machining machine hours $72,000 Machine set-ups number of set-ups $937,500 Total overhead costs: $6,000,000 Quantity of activity driver consumed: Activity Model A Model B Total Soldering 1,185,000 385,000 1,570,000 number of solder joints Shipments 16,200 3,800 20,000 number of shipments Quality control 56,200 21,300 77,500 number inspections Purchase orders 80,100 109,980 190,080 number of orders Machining 176,000 16,000 192,000 machine hours Machine set-ups 16,000 14,000 30,000 number of set-ups X 15 C