Req 1 and 2 has been answered. Please answer REQ 3 ONLY.

Requirement 1. Use the company's current costing system to find the total cost of producing all Medium TVs and the total cost of producing all Large TVs. What was the average cost of making each unit of each model? Round your answers to the nearest cent. Begin by identifying the formula to compute the current plantwide manufacturing overhead rate, and then compute the rate. (Round your answer to the nearest cent.) Total manufacturing overhead Total direct labour hours = / 1 Plantwide overhead rate 37.16 $ 929,080 25,000 = $ Now use this rate to allocate the overhead to each model, and then calculate the average cost of making each unit of each model. (Round cost per unit to the nearest cent.) Manufacturing cost Medium Large Direct materials $ 668,000 $1,240,000 Direct labour 219,000 385,000 341,872 587,128 Manufacturing overhead Total manufacturing cost Number of units produced $1,228,872 $2,212,128 3,200 384.02 $ 3,700 597.87 $ Cost per unit Requirement 2. Use ABC to find the total cost of producing all Medium TVs and the total cost of producing all Large TVs. What was the average cost of making each unit of each model? Round your answers to the nearest cent. Begin by identifying the formula to compute the activity cost allocation rates, and then calculate the activity cost allocation rates. (Round your answers to the nearest cent.) Activity overhead / Total activity allocation base = Activity allocation rate Materials handling $ 1 $260.00 /mat. orders handled = 176,800 648,600 680 47,000 Machine processing $ $ 13.80/machine hour = 102 680 10 900 C 0.60 Kies Inc. manufactures only two products, Medium (42-inch) and Large (63-inch) plasma screen TVs. To generate adequate profit and cover its expenses throughout the value chain, Kies prices its TVs at 200% of manufacturing cost. The company is concerned because the Large model is facing severe pricing competition, whereas the Medium model is the low-price leader in the market. The CEO questions whether the cost numbers generated by the accounting system are correct. He has just learned about ABC and wants to reanalyze this past year's product costs using an ABC system. Information about the company's products this past year follows: (Click the icon to view the data.) Currently, the company applies manufacturing overhead on the basis of direct labour hours. The company incurred $929,080 of MOH this year and 25,000 direct labour hours (9,200 direct labour hours making Medium TVs and 15,800 making Large TVs). The ABC team identified three primary production activities that generate MOH costs: (Click the icon to view the production activities.) Requirements Production activities Data Medium (42-inch) Plasma TVs: 4/0,700 The company's manufacturing overhead numbers are as follows: Materials Handling ($176,800); driven by number of material orders handled Machine Processing ($648,600); driven by machine hours Packaging ($103,680); driven by packaging hours Manufacturing overhead Total manufacturing cost $ 432,320 2,077,320 3,700 561.44 1,363,760 $ 3,200 426.18 $ Number of units produced The company's only two products required the following activity levels during the year: $ Cost per unit Material Orders Requirement 3. How much cost distortion was occurring between Kies's two products? Calculate the cost distortion in to and final answers to the nearest cent. Use parentheses or a minus sign for undercosted and negative cost distor Machine Packaging Hours Handled Hours Medium Large 390 4,600 Medium. Large. 24,000 23,000 Cost per unit using current system 290 6,200 Cost per unit using ABC Overcosting/(Undercosting) Number of units Print Total cost distortion Done Total direct material cost: $668,000 Total direct labour cost: $219,000 Production volume: 3,200 units Total direct material cost: $1,240,000 Total direct labour cost: $385,000 Production volume: 3,700 units Print Done Large (63-inch) Plasma TVs: - Requirements 1. Use the company's current costing system to find the total cost of producing all Medium TVs and the total cost of producing all Large TVs. What was the average cost of making each unit of each model? Round your answers to the nearest cent. 2. Use ABC to find the total cost of producing all Medium TVs and the total cost of producing all Large TVs. What was the average cost of making each unit of each model? Round your answers to the nearest cent. 3. How much cost distortion was occurring between Kies's two products? Calculate the cost distortion in total and on a per unit basis. Could the cost distortion explain the CEO's confusion about pricing competition? Explain. Print Done X