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SECTION A There are 15 questions in this section. You must answer all of them. You must show the basis of your calculations to obtain
SECTION A There are 15 questions in this section. You must answer all of them. You must show the basis of your calculations to obtain marks. The following information relates to Questions A1 to A3 Weston Computers Ltd makes and sells tablets, laptops, and desktop PCs. The company's main customers are companies and other types of organisations. Weston Computers Ltd uses an activity-based costing system. Details for a typical month are as follows: Products Tablets Laptops Desktop PCs Total Revenue 300,000 1,000,000 830,000 2,130,000 Direct material 65.000 235,000 180,000 480,000 Direct labour 120,000 100,000 60,000 280.000 Volume (units) 1,500 2,500 1,000 5,000 Overheads Customer service 100,800 Purchasing and receiving 5,250 Materials handling 11,625 Total 117,675 The total activity volume associated with each type of product for the period are: Products Tablets Laptops 1 Direct labour hours per unit Minutes on customer calls in the month Number of purchase orders raised in the month Number of components used in production per unit 2 76.000 15 11 Desktop PCs 1.5 50,000 10 10 126,000 10 8 Question A1 (REQUIRED) Calculate the cost per driver for the customer service activity. (1 mark) Question A2 (REQUIRED) Calculate the cost per driver for the material handling activity. (1 mark) Question A3 (REQUIRED) Calculate the total overhead costs of purchasing and receiving allocated to Tablets. (2 marks) Question A4 (REQUIRED) In a sentence or two, contrast top-down budgets with botom-up budgets in terms of their effectiveness on large organisations versus small organisations. (2 marks)
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