Diagram or explain the existing cost system used at Voltaic Vehicles to assign costs to CEV and

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Question:

Diagram or explain the existingcost system used at Voltaic Vehicles to assign costs to CEV and GEV. Clearly define the allocation bases as well as the rates used to assign these costs.

2. What is the budgeted cost per vehicle for CEV and GEV under the existing cost system in 2023, respectively?

3. Which department is being hurt (i.e too many costs allocated) by existing system? Why? No calculation is needed for this question.

4. Diagram the cost system suggested by the new cost study for 2023? Clearly identify the allocation bases as well as the rates used to assign costs. Is this an ABC system? Why?

5. What is the budgeted cost per vehicle for CEV and GEVunder the cost system suggested by the new cost study in 2023, respectively?

6. Which system would you recommend Voltaic use? Why is this currently a better system? Are there any worries about moving to the new system? No calculation is needed for this question.

7. Voltaic uses the number of emergencies visits to evaluate its customer services staff. Identify one strength and one weakness of this performance measure? No calculation needed.

8. Exhibit 3 shows there is a significant cost increase for direct material. Analyze these results carefully using data provided in the case for CEV and GEV, respectively. Disentangle (quantitively - ie vis variance analysis) and explain why the actual results differ from the budgeted amounts.

9. Compile a budgeted operating income statement for 2024

10. Suppose there is no competitor that offers similar test to those conducted by HCCTP. How should Voltaic charge HCCTP's users for usage? Be specific in your answer using date provided by the case. Explain your answer.

11. How will your answer above change if competitors offer similar tests to those conducted by HCCTP? What is the minimum that Voltaic can charge and be no worse off of? (No calculation is needed for this answer)

12. Voltaic is considering reorganizing it machine setup operation into a separate unit and letting it charge CEV and GEV. The capacity for the machine setup operation is 150,000 setups a year. What should be the transfer price such that CEV and GEV would make decisions that maximize Voltic's interest? BE specific in your answer using data provided by the case. Explain your answer.