U-Build-It produces carpentry tools for homeowners. The company recently completed an Obj. 4 activity-based costing study and is attempting to understand the results. The following table summarizes sales volume and overhead cost information for a sample of five products. In some cases, the activity-based costing study produced costs below the traditional product cost. In other instances, the activity-based cost study produced costs above the traditional product cost.

a. Compute the percentage change for each product using the formula (activity-based cost - traditional cost) \(\div\) traditional cost.

b. Sort the percentages calculated in requirement

(a) from largest to smallest and prepare a bar graph summarizing the results.

c. What relationship do you observe between volume and cost?

d. How might you explain this relationship?

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Overhead Cost Overhead Cost Product Volume Traditional Activity-Based A Moderate $100 $112 BCDE Moderate 75 75 C High 87 73 Low High 160 232 95 70