em $2(20$ Points$)$

rupka & Wilson, Inc. manufactures two products, Financial and Managerial. The company believes that its existing

costing system, which allocates MOH based on machine hours, may be cross$-$subsidizing the costs of its products. Joe

Krupka, CFO and Controller, is considering an ABC system. In order to implement ABC, Krupka has identified four

activities routinely performed in the factory, as well as the total yearly MOH costs and cost drivers associated with those

activities.

K&W$\text{'}$s only products are Financial and Managerial. Total yearly costs, activity levels, and production levels for the two

products are as follows:

A$)$ Determine,the pool rates for each of the $4$ activity pools.

$($on back but please answer$)$

B$)$ if K&W uses ABC$($absorption based costing$)$ what it the toral amount of MOH allocated to financial eaxh year? show work

C$)$ assume the ABC system yields a more accurate production cost. what was the per unit cost distortion present in the traditional system for financial? was financial being overcosted or undercosted?