4. Traditional Costing vs. Activity Based Costing (25 points). The Outer Banks Surfing Company manufactures custom surfing boards for surfing camps and surfing teams competing in national and regional competitions based on the customer specifications and with the team/camp logo printed on the board surface. The following overhead costs and cost drivers were estimated for the upcoming year: Expected Expected Overhead Pool Costs Cost Driver Quantity Setup costs 80,000 Number of setups 100 Material Preparation 96,000 Direct material costs 200,000 Molding and shaping 72,000 Machine hours 5,200 Sealing and finishing 44,000 Sealing and finishing Labor costs 32,000 Total direct labor hours for next year were estimated at 40,000. The following data pertain to two recent completed jobs: Job A Job B Cost of direct materials 10,000 15,000 Cost of direct labor 8,000 14,000 Number of units completed 50 100 Number of direct labor hours 400 800 Number of setups 5 5 Number of machine hours 250 200 Sealing and finishing labor costs 350 400 Answer the following questions assuming the company is using a traditional company-wide overhead rate based on direct labor hours. Show your calculations. a. The company-wide overhead rate is: b. The amount of overhead costs allocated to Job A is: c. The amount of overhead costs allocated to Job B is:d. The total production cost of Job A is: e. The total production cost of Job B is: f. The production cost of each surfboard (unit cost) for Job A: g. The production cost of each surfboard (unit cost) for Job B: Answer the following questions assuming the company is using Activity Based Costing. Show your calculations. h. The company overhead allocation rates are: i. The amount of overhead costs allocated to Job A is: j. The amount of overhead costs allocated to Job B is: k. The total production cost of Job A is:I. The total production cost of Job B is: m. The production cost of each surfboard (unit cost] for Job A: n. The production cost of each surfboard (unit cost] forJob B: Assume you are the manager who need to decide on the appropriate cost system, which cost system would you prefer? Why? o. Based on your ndings above, under the companywide allocation rate, is there a problem of overlunder costing? Explain you answer. p. Is there additional information you would need to evaluate the pricing and profitability of these jobs