Part A: Determine the activity-cost-driver rate for packaging and oven costs. Activity OH Cost Activity Levels Activity Rate Part B: Using an ABC system, for each cookie: Compute the estimated overhead cost per cookie. Macaroon Sugar Buttercream Overhead Cost - Packaging Cost Per Cookie Overhead Cost - Oven Cost Per Cookie $ - $ Compute the gross profit per unit for each cookie. Macaroon Sugar Buttercream Gross profit Part C: Using the Traditional system, for each cookie: Compute the estimated overhead cost per cookie. Overhead per Direct Labor Hour Compute the gross profit per unit for each cookie. Macaroon Sugar Buttercream Gross profit Part D: Explain the difference between the profits obtained from the traditional system and the ABC system. Which system provides a better estimate of profitability? Why? Aunt Ethel's Fancy Cookie Company manufactures and sells three flavors of cookies: Macaroon. Sugar, and Buttercream. The batch size for the cookies is limited to 1,000 cookies based on the size of the ovens and cookie molds owned by the company. Based on budgetary projections, the information listed below is available: Macaroon 500,000 Sugar 800,000 Buttercream 600.000 Projected Sales in units Buttercream Selling Price Direct materials Direct labor S S Per Unit Data Macaroon Sugar 0.80S 0.75S 0.20 S 0.15S 0.04S 0.02S 1.00 1.00 0.50 lo Buttercream Direct labor hours Oven hours Packaging hours Hours per 1000-unit batch: Macaroon Sugar 2 1 0.5 1 1 0.5 1 1 0.5 Total overhead costs and activity levels for the year are estimated as follows: Overhead Costs Activity Direct labor Oven Packaging Activity Levels 2.400 hours 1.900 oven hours 950 packaging hours | 210,000 150.000