Richmond Auto Parts (RAP) has a Seat Manufacturing Department that uses ABC. RAP's activity cost allocation rates include the following: (Click on the icon to view ABC system data.) Suppose Ford has asked for a bid on 30,000 built-in baby seats that would be installed as an option on some Ford SUVs. Each seat has 14 parts and the direct materials cost per seat is $7. The job would require 11,000 direct labor hours at a labor wage rate of $20 per hour. In addition, RAP will use a total of 250 machine hours to fabricate some of the parts required for the seats. Read the requirements. Requirements Requirement 1. Calculate the total cost of producing and packaging 30,000 baby seats. Also calcula 1. Calculate the total cost of producing and packaging 30,000 baby seats. Also calculate the average cost per seat. Direct materials 210,000 220,000 2. Direct labor Allocated overhead: Machining Assembling 20,000 378,000 Packaging 42,000 Total cost of order 870,000 Divide by number of seats 30,000 39 Average cost per seat For bidding, RAP adds a 15% markup to total cost. What price will the company bid for the Ford order? 3. Suppose that instead of an ABC system, RAP has a traditional product costing system that allocates manufacturing overhead at a plantwide overhead rate of $70 per direct labor hour. The baby seat order will require 11,000 direct labor hours. Calculate the total cost of producing the baby seats and the average cost per seat. What price will RAP bid using this system's total cost? 4. Use your answers to Requirements 2 and 3 to explain how ABC can help RAP make a better decision about the bid price it will offer Ford. Data table Activity Video Calculator Ask my instructor Machining Assembling Packaging Allocation Base Number of machine hours Number of parts Number of finished seats Activity Cost Allocation Rate $80.00 per machine hour 0.90 per part heck 1.40 per finished seat