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Comparing Two Products under Traditional and Activity-Based Costing Compare two projects under development by the same company. The following are a few aspects of each

Comparing Two Products under Traditional and Activity-Based Costing Compare two projects under development by the same company. The following are a few aspects of each products development process relevant to costs.

Product A

Requires 3840 hours of testing

Requires 5390 units of computing power

Requires 20 developer hours to implement

Product B

Requires 960 hours of testing

Requires 2310 units of computing power

Requires 80 developer hours to implement

Cost Items Cost of Each Activity
Testing: $30,800
Computing power: $46,200
Developer hourly cost: $11 per hour

Activity-Based Costing

Using the data above for products A and B, calculate the costs using activity-based costing. Allocate the costs of testing, computing, and development based on the rates of activity consumed by each product's development process. If required, in your computations, round per unit costs to the nearest cent. Round your final answers to the nearest dollar.

Cost Activity Base
Testing Hours of testing
Computing cost Units of computing power
Developer cost Development hours

Product A

Testing cost

Computing cost

Developer cost

Total cost

Product B

Testing cost

Computing cost

Developer cost

Total cost

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