Database Design does just what its name indicates: It provides a database design service for its clients. The cost of designing a database can be broken down into three elements:

1. Designing the database. The amount of work is based on the accuracy of the customer's specifications and how much time is spent with the customer to understand those specifications.

2. Writing program code. This is a function of the number of (input) screens, file records, and

(output) reports, all of which are determined in the design phase.

3. Testing. This is also a function of the number of (input) screens, file records, and (output)

reports.

Database Design has budgeted for staff and staff-related costs for each of the following:

Apart from for staff members, the main budget costs are for accommodation (rental and utilities), which costs \($100,000\) per year; lease costs of computer equipment of \($25,000\) per year;
and travel costs of \($10,000. Accommodation\) and computer lease costs are primarily attributable to programming and testing staff while travel costs are attributable wholly to design staff. The manager's costs are split equally among the three functions.
Direct costs and overhead costs are to be allocated on an activity-costing basis, using the following estimates as cost drivers:

a. Calculate the total budgeted costs for the company.

b. Calculate the cost driver rates for each activity.

c. Estimate the cost for a job requiring 15 days of design and 150 screens, records, and reports.

Design Dept. Programming Dept. Testing Dept. Manager 6 staff @ $30,000 4 staff @ $25,000 2 staff @ $20,000 1 person @ $45,000