Overhead Item Expected Cost ($) Cost Driver Expected Activity Setup Costs 60,000 Number of Setups 200 Purchasing Costs 40,000 Number of Purchases 2,000 Maintenance Costs 70,000 Maintenance Hours 10,000 Customer Order Processing Customer Orders Electricity Charges Kilowatt-Hours The following data is retrieved for the job completed for Warrena Golf Club. Direct materials $300 Direct labor $200 Number of golf balls completed 2600 Direct labor hours 10 Number of setups 4 Number of purchases 2 Maintenance hours 40 Kilovvatt-hours 30 The company's budgeted direct labour hours for the year is 2,500 direct labour hours. Sussim also manufactures a diverse range of other balls such as tennis balls, basketballs, soccer balls, just to name a few. The management has been considering the implementation of the Activity-Based Costing system as a replacement of the existing Normal Costing method. Re uired (a) (b) (C) (d) Using the normal costing method, compute the cost of each golf ball (rounded to 2 decimal place of a dollar) for this customer Warrena Golf Club, using direct labour hours to apply overhead. Using activity-based costing method, compute the unit cost of the same ball (rounded to 2 decimal place of a dollar) sold to Warrena Golf Club. Evaluate which costing method gives the product manager a more accurate picture of the cost and comment on the suitability of the current selling price. Compare Normal Costing and Activity-Based Costing methods and discuss the feasibility of replacing the former with the latter. Assuming that the actual overhead incurred on this job is $1,500, prepare journal entries (narrations are not required) to record the overheads applied under the normal costing method and the closing of any over/under application of overheads