The following annual data related manufacturing company for July 2022. The company produces two types of cheeses, namely, Happy cow Slices and Herbs Cheese.

Details	Budgeted	Actual
		Slices	Herbs
Machine Hrs	22500	900	450
Direct Labour hrs	45000	1200	900
Direct Labour Costs	630000	33.75/hour	33.75/hour
Manufacturing Overhead cost	819000	76000	76000

The company uses machine hours as the cost driver.

REQUIRED:

A. Calculate the company's predetermined plant-wide rate.

B. Estimate the overhead costs of each of the two products

C. Compare the actual overhead cost to the amount of overhead applied to the two products in July.

QUESTION 2

Two companies have identical products, total fixed costs, and variable costs per unit, yet one company is able to set a lower price for its product and still be as profitable as the other company. Explain how this can happen with a suitable example.

QUESTION 3

A car rental company rents small, medium, and family-sized cars. What assumptions would be made for the purpose of a cost volume product analysis? Does this mean that CVP is of little value to the business? Explain your answer.