Exercise 18-10 Kragan Clothing Company manufactures its own designed and labeled athletic wear and sells its products through catalog sales and retail outiets. While Kragan has for years used activity-based costing in its manufacturing activites, it has always se traditional sting in assigning its selling costs to its product lines. Sell ng costs have traditionally been assigned to Kragan's product lines at a te o 70% d ect mate als costs. Its direct materials costs or them th March for Kragan's high-intensity" line of athletic wear are $408,000. The company has decided to extend activity-based costing to its selling costs. Data relating to the "high-intensity" line of products for the month of March are as follows. Overhead Number of Cost Drivers Used per Activity Activity Cost Pools Cost Drivers Dollar sales s0.05 per dollar sales 5300 per minute $922,000 Column inches Catalags maled Catalog orders 1,900 58,300 Advertising-Internet s10 per column inch $2.50 per catalog Cost of catalog sales Credit and collection $1 per catalag order $0.03 per dollar sales 922,000 Compute the selling costs to be assigned to the "high-intensity'"line of athletic wear for the month of March (1) using the traditional product costing system (arect matenals cost is the cast driver), and (2) using activity-based costing Selling cost to be assigned By what amount does the traditional product costing system undercost or overcost the "high-intensity" product line? versios 4.24