Dino Dog Collars uses activity-based costing. Dino's system has the following features:

Each collar has 4 parts; direct materials cost per collar is $9. Direct labor cost is $4 per collar. Suppose Animal Hut has asked for a bid on 25,000 dog collars. Dino will issue a total of 150 purchase orders if Animal Hut accepts Dino's bid.
Requirements
1. Compute the total cost Dino will incur to purchase the needed materials and then assemble and package 25,000 dog collars. Also compute the cost per collar.
2. For bidding, Dino adds a 40% markup to total cost. What total price will the company bid for the entire Animal Hut order?
3. Suppose that instead of an ABC system, Dino has a traditional product costing system that allocates indirect costs other than direct materials and direct labor at the rate of $9.60 per direct labor hour. The dog collar order will require 12,000 direct labor hours. What total price will Dino bid using this system's total cost?
4. Use your answers to Requirements 2 and 3 to explain how ABC can help Dino make a better decision about the bid price it will offer AnimalHut.

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Cost Allocation Rate Allocation Basc Activity Purchasing Assembling Packaging $65.00 per purchase order $ 0.36 per part $ 0.25 per collar Number of purchasc orders Number of parts Number of finished collars