XYZ$$s Company$$s manufacturing Overhead Costs were as under:

In the quarter ended March $24,$ the company$$s manufacturing overhead costs were:

Equipment operation expenses $$250,000$

Equipment maintenance expense $$50,000$

Wages paid to technicians $$170,000$

Wages paid to storemen $$70,000$

Wages paid to dispatch staff $$80,000$

Total $$620,000$

Presently overhead costs are being absorbed on labour$-$hour rate method.

Company wants to change the method to ABC method.

The following were identified as the most significant activities:

$($i$)$ Receiving component consignments from suppliers

$($ii$)$ Setting up equipment for production runs

$($iii$)$ Quality inspections

$($iv$)$ Dispatching goods as per customers' orders.

$$ Equipment operation and maintenance expenses are apportioned as: Component stores $15\%,$ manufacturing $70\%,$ and goods dispatch $15\%$

$$ Technician's wages are apportioned as: Equipment maintenance $30\%,$ set up equipment for production runs $40\%,$ and quality inspections $30\%.$

During the quarter:

i$.$ a total of $200$ direct labour hours were worked $($paid at Rs$.12$ per hr$.)$

ii$.980$ components consignments were received from suppliers

iii. $1020$ production runs were set up

iv$.640$ quality inspections were carried out

v$.420$ orders were despatched to customers.

The company$$s production during the quarter included components X$,$Y and Z$.$ The following information is available:

Component X Component Y Component Z

Direct labour hours worked $2548050$

Direct material $$1,200$ $$2,900$ $$1,800$

Component consignments received $422428$

Production runs $161812$

Quality inspections $10818$

Orders dispatched $228546$

Quantity produced $56012,8002,400$

Required:

a$)$ Calculate the unit cost of X$,$ Y and Z and components, using the company$$s existing cost accounting system.

Explain how an ABC system would be developed using the information given. Calculate the unit cost of components X$,$ Y and Z using the ABC system.