the picture question

Question 1 (25 marks) Leca Ltd. (Leca) manufactures and sells three models of camera. Sales revenue and direct costs for April 2018 are shown as follows: pl Model Beginner Intermediate Pro-level rovone -Units produced and sold ( Unit selling price Sales revenue Direct materials Direct labor Machine hours consumed 400 $6,000 $2,400,000 $700,000 $600,000 300 hrs/ 200 $15,000 $3,000,000 $1,600,000 $750,000 90 hrs 100 $33,000 $3,300,000 $1,820,000 $840,000 60 hrs The company adopts a simple costing system by_allocating the manufacturing overhead based on the machine hours which are used to manufacture the three models. Manufacturing overhead incurred in the month includes the following: 2 Activity > $ 7 Engineering Quality control Machinery Materials handling 300,000 1320 =1930) 300,000 193.733377) 750,000 60.2125 ou 300,000 1,650,000 Aceh Recently the company has learned that an activity-based costing system can provide more accurate cost information through analyzing how the products use the activities during the operating processes. The following data were collected from operations in April: Activity Cost Driver Beginner Intermediate Pro-level 10 24 Engineering Quality control Machinery Materials handling No. of engineering hours No. of inspection hours No. of machine hours No. of orders 6 36. 300 5 120 90 5 204 60 20 Required: (a) (6 marks) Use the current simple costing system to prepare a product line and total company income statement with profitability %. Show all your workings. (b) Use the activity based costing system to prepare the product line (14 marks) and total company income statement with profitability %. Show all your workings. (c) (5 marks) Compare and explain differences in product' costs under both product costing systems. What are the implications for Leca's pricing strategy