The Stamford store of Henderson Mart a chain of small neighborhood convenience? stores, has a Kaizen? (continuous improvement) approach to budgeting monthly activity costs for each month of 2018. Henderson Mart has three product? categories: soft drinks? (35% of cost of goods sold? [COGS]), fresh snacks? (25% of? COGS), and packaged food? (40% of? COGS). The following table shows the four activities that consume indirect resources at the Stamford ?store, the cost drivers and their? rates, and the? cost-driver amount budgeted to be consumed by each activity in January 2018

	1. What are the total budgeted costs for each activity and the total budgeted indirect cost for March 2018?
	2. What are the benefits of using a Kaizen approach to? budgeting? What are the limitations of this? approach, and how might Henderson Mart management overcome? them?

January 2018 Budgeted Cost-Driver Rate January 2018 Budgeted Amount of Cost Driver Used Soft Fresh Packaged Activity Cost Driver Drinks Snacks Food Ordering Delivery Shelf-stocking Customer support 16 16 24 97 10,800 $ Number of purchase orders Number of deliveries Hours of stocking time Number of items sold 28 85 64 $ 24.00 $ 0.23 19 4,400 34,700