Louie Beton (LB) ABC Problem Louie Beton (LB) is a designer of high-quality bags and purses....

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Louie Beton (LB) ABC Problem Louie Beton (LB) is a designer of high-quality bags and purses. Each design is made in small batches. Each summer, LB comes out with new designs for the bag and purse. The company changes these designs every year. The bags are all made on the same fabrication equipment that is expected to operate at capacity., The equipment must be switched over to a new design and set up to prepare to produce each new batch of products. When completed, each batch of products is immediately shipped to a wholesaler Shipping costs vary with the number of shipments. Budgeted for costs and activities for the year ending 2019 is as follows: Direct materials - purses P319,155 Direct materials - bags 454,995 Direct manufacturing labor - purses 99,000 Direct manufacturing labor - bags 113,000 Setup 64,000 Shipping 73,000 Design 169,000 Plant, utilities, and administration 221,000 Additional information: BAGS PURSES Number of products 6,175 3,075 Hours of production 1,665 1,585 Number of batches 120 80 Number of designs 2 2 Required: A. Identify the most appropriate cost driver for each category, briefly Explain your choice of cost driver. B. Calculate the budgeted cost per unit of cost driver for each category. C. Calculate the budgeted total cost and cost per unit for each product line. Explain how you can use the information in letter C to reduce costs. Louie Beton (LB) ABC Problem Louie Beton (LB) is a designer of high-quality bags and purses. Each design is made in small batches. Each summer, LB comes out with new designs for the bag and purse. The company changes these designs every year. The bags are all made on the same fabrication equipment that is expected to operate at capacity., The equipment must be switched over to a new design and set up to prepare to produce each new batch of products. When completed, each batch of products is immediately shipped to a wholesaler Shipping costs vary with the number of shipments. Budgeted for costs and activities for the year ending 2019 is as follows: Direct materials - purses P319,155 Direct materials - bags 454,995 Direct manufacturing labor - purses 99,000 Direct manufacturing labor - bags 113,000 Setup 64,000 Shipping 73,000 Design 169,000 Plant, utilities, and administration 221,000 Additional information: BAGS PURSES Number of products 6,175 3,075 Hours of production 1,665 1,585 Number of batches 120 80 Number of designs 2 2 Required: A. Identify the most appropriate cost driver for each category, briefly Explain your choice of cost driver. B. Calculate the budgeted cost per unit of cost driver for each category. C. Calculate the budgeted total cost and cost per unit for each product line. Explain how you can use the information in letter C to reduce costs.