The purchasing manager of Prime Inc. uses two suppliers, Platinum Co. and Silver Co. to purchase...

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The purchasing manager of Prime Inc. uses two suppliers, Platinum Co. and Silver Co. to purchase two parts; Part A1 and Part B2. Other than the purchase cost, Prime Inc. incur cost related to repairing products under warranty and expediting products. Repairing products occur because of part failure while expediting cost is due to late delivery of parts by the suppliers. Activity costs caused by suppliers: Activity Repairing products Expediting products Costs (RM) 800,000 200,000 1. Supplier Data Unit purchase price Units purchased Failed Units Late shipments Platinum Co Silver Co Part Al Part B2 Part Al Part B2 RM20 RM52 RM24 RM56 80,000 40,000 10,000 10,000 1,600 380 10 10 60 40 0 0 Required: a) Determine the total purchasing cost of Part A1 and Part B2 for each supplier using Activity Based Costing (ABC). b) Based on (a), what is unit cost of Part Al and Part B2 ? c) Explain how Activity Based Costing (ABC) is used to evaluate the suppliers at Prime Inc. The purchasing manager of Prime Inc. uses two suppliers, Platinum Co. and Silver Co. to purchase two parts; Part A1 and Part B2. Other than the purchase cost, Prime Inc. incur cost related to repairing products under warranty and expediting products. Repairing products occur because of part failure while expediting cost is due to late delivery of parts by the suppliers. Activity costs caused by suppliers: Activity Repairing products Expediting products Costs (RM) 800,000 200,000 1. Supplier Data Unit purchase price Units purchased Failed Units Late shipments Platinum Co Silver Co Part Al Part B2 Part Al Part B2 RM20 RM52 RM24 RM56 80,000 40,000 10,000 10,000 1,600 380 10 10 60 40 0 0 Required: a) Determine the total purchasing cost of Part A1 and Part B2 for each supplier using Activity Based Costing (ABC). b) Based on (a), what is unit cost of Part Al and Part B2 ? c) Explain how Activity Based Costing (ABC) is used to evaluate the suppliers at Prime Inc.