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st 47 E year Would do this. 6-27 Activity-based budgeting. The Parksville location of Your Mart (YM), a chain of small neigh- bourhood grocery stores,

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st 47 E year Would do this. 6-27 Activity-based budgeting. The Parksville location of Your Mart (YM), a chain of small neigh- bourhood grocery stores, is preparing its activity-based budget for January 2019. YM has three product categories: soft drinks, fresh produce, and packaged food. The following table shows the four activities that consume indirect resources at the Parksville store, the cost drivers and their rates, and the cost driver amount budgeted to be consumed by each activity in January 2019. January 2019 January 2019 Budgeted Amount Budgeted of Cost Driver Used Cost Driver Soft Fresh Packaged Activity Cost Driver Rate Drinks Produce Food Ordering Number of purchase orders $90.00 14 24 14 Delivery Number of deliveries 82.00 12 62 19 Shelf-stocking Hours of stocking time 21.00 16 172 94 Customer support Number of items sold 0.18 4,600 34,200 10,750 Required 1. What is the total budgeted indirect cost at the Parksville store in January 2019? What is the total bud- geted cost of each activity at the Parksville store for January 2019? What is the budgeted indirect cost of each product category for January 2019? 2. Which product category has the largest fraction of total budgeted indirect costs? 3. Given your answer in requirement 2, what advantage does YM gain by using an activity-based approach to budgeting over, say, allocating indirect costs to products based on cost of goods sold

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