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Description XYZ Company designs and produces automotive parts. In 2017, actual variable manufacturing overhead is $308,600. XYZ s traditional costing system allocates variable manufacturing overhead

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Description XYZ Company designs and produces automotive parts. In 2017, actual variable manufacturing overhead is $308,600. XYZ s traditional costing system allocates variable manufacturing overhead to its three customers based on machine hours and prices its contracts based on full costs. One of its customers has complained of being charged noncompetitive prices, so XYZ realized that it is time to examine the consumption of overhead resources more closely. They know that there are three main departments that consume overhead resources: design, production, and engineering as follows: Depart Cost Variabl Usage of cost drivers by ment driver customer contract manuf acturin g overhe Masa ad in Ahmad Bayan 2017 200 80 Design Design $39,00 110 hours 0 60 240 Engine Engine 29,600 70 ering ering hours 2,800 1,080 Produc Machi 240,00 120 tion ne 0 hours Total $308.6 00 Compute the overhead allocated to each customer using the traditional mantina Muntem that he moshina hur Compute the overhead allocated to each customer using the traditional costing system that has machine hours as the allocation base, and then recompute the overhead allocated to each customer using the ABC costing system Who do you think is the customer who complains about prices

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