• How to determine which product is labour or machine intensive (especially which Table)?
• According to Table 3 & 4, Product X123 seems to use more of machine department compare to assembly department and whereas, Product R907 uses more of assembly department compare to machine department. Am I right?
• For Question 3, I believe Activity based costing has a better cause-effect relations. It is possible to see improvement in the allocation of overheads, with minimal distortion. (Please advise further)

Zest produces and supplies 2 types of component parts to industrial equipment manufacturers. These parts are known as X123 and R907. There are 2 departments in the factory: the machining and assembly departments. The machining department has highly automated operations, while assembly has labour-intensive operations. Table 1: Annual production data by product Units produced Product X123 Product R907 1,000 2,000 Total direct labour hours (DLH) consumed per unit 5 DLH 15 DLH Total machine hours (MH) consumed per unit 15 MH 5 MH The overhead cost incurred in the Machining department was $1,300,000, while the overhead cost in the Assembly department was $350,000.