Kestral Manufacturing identified the following overhead costs and cost drivers for the current period. Kestral produces customized products that move through several different processes. Materials and intermediate products are moved among several different work stations. Custom features are designed by engineers.

Information for three of the jobs completed during the period follows.

REQUIRED

A. If the company uses ABC, how much overhead cost should be assigned to Job 42?

B. If the company uses ABC, calculate the cost per unit for Job 43.

C. Kestral would like to reduce the cost of its overhead activities. Describe non-value-added activities and explain why reducing these specific activities would also reduce cost.

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Estimated Eimated Cost Driver Cost $ 40,000 160,000 100,000 260,000 $560,000 Activity Activity Level Machine setup Material handling Product design Inspection Total cost Number of setups Number of times materials are moved Design hours Number of inspections 400 16,000 2,000 13,000 Job 42 $10,000 $4,000 200 Job 43 $24,000 $4,000 100 4 20 20 100 Job 44 $16,000 $8,000 400 Direct materials Direct labor Units completed Number of setups Number of material moves Number of inspections Number of design hours 60 40 20 100 60 20