XYZ Corporation previously used conventional cost allocation and allocated its overhead costs based on Direct Labour (DL) Hours. Recently XYZ Corporation adopted activity-based costing (ABC) to determine product costs. The company has provided the following monthly data conceming its activity-based costing system: Activity Cost Pool Processing Packaging Assembly Total Budgeted Cost S67,500 Total Budgeted Base 5,000 Machine Hours 700 Setups 80,000 DL Hours S273,700 S204,000 Total Actual Activity Model X Model Z Processing Packaging Assembly 4,000 300 1,000 400 10,000 70,000 The team that implemented ABC felt that the above data were typical of ongoing operations. However, some employees recalled that when demand was really heavy in the past, machines had worked 15,000 hours in a month and the factory handled 800 setups without production delays or use of overtime. REQUIRED: Question 4-A: Using conventional cost allocation, calculate the allocated overhead costs to Model X and Model Z. 13 marks Question 4-B: Using ABC, calculate the allocated overhead costs to Model X and Model Z. What might be the role of capacity? 17 marks| Question 4-C: Discuss possible reasons that ABC systems designed for internal decision-making may not conform to generally accepted accounting principles (such as IFRS)? |5 marks] Question 4-D: Discuss the advantages and disadvantages of regular ABC compared to time-based ABC. |5 marks) Question 4-E: How may ABC help inform the decision to initiate production of a new product? Discuss the role of idle capacity. 15 marks]