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###### Perrin Bags (PB) is a designer of high-quality backpacks and purses. Each design is made in...

Perrin Bags (PB) is a designer of high-quality backpacks and purses. Each design is made in small batches. Each spring, PB comes out with new designs for the backpack and for the purse. The company uses these designs for a year and then moves on to the next trend. 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 for the production of 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 information for the year is as follows: (Click the icon to view the budgeted information.) Data Table Х Read the requirements Design Product-sustaining cost Plant utilities and administration Facility-sustaining cost Perrin Bags Requirement 2. Identify the most appropriate cost driver for each cost category. Explain briefly your choice of cost driver. Budget for Costs and Activities Cost Cost Driver Reason For the Year Ended February 28, 2014 Direct materials-purses Number of purses The cost is determined by the number of output. Direct materials-purses $ 303,800 Direct materials-backpacks Number of backpacks The cost is determined by the number of output. Direct materials-backpacks 461,700 Direct labor-purses Number of purses The cost is determined by the number of output. Direct manufacturing labor-purses 93,000 Direct labor-backpacks Number of backpacks The cost is determined by the number of output. , Direct manufacturing labor-backpacks - 97,200 Setup Number of batches The cost is determined by the number of batches. Setup 114,400 Shipping Number of batches The cost is determined by the number of batches. Shipping 72,400 Design Number of designs The cost is determined by the number of designs. Design 168,000 Plant utilities and administration Hours of production The more the machines are used the higher the cost. 249,000 Plant utilities and administration Requirement 3. Calculate the budgeted cost per unit of cost driver for each cost category. (Round the cost driver rates to four decimal places. Abbreviations used: "uti $ 1,559,500 Total labor.) Other budget information follows: Cost Total quantity of cost driver = Cost driver rate Backpacks Purses Total DM purses Number of bags 6,075 3.100 9.175 Hours of production 1,555 2.595 4.150 Choose from any list or enter any number in the input fields and then click Check Answer. Number of batches 150 50 200 Number of designs 3 3 6 Clear All remaining 11 parts Print Done

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