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Health C Us, inc, wes a traditional product costing system to assign overhead costs uniformily to all its puckaged multigrain products. To move Food and

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Health C Us, inc, wes a traditional product costing system to assign overhead costs uniformily to all its puckaged multigrain products. To move Food and Drug. Administration requirements and to assure its customers of safe, sanitary. and nutritious food, Health CUS engages in a high level of quality control. Health C Us assiges its qualiv-control overhead costs to all products at a rate of 17% of direct laber costs. Its direct labor cost for the monsh of June for its low-calorie beeakfast line is $55.000. in response to repeated requests from its financial vice president. Health 'C Us's managensent agress to adopt axtmitr based costing Data relating to the low: calorie breakfant line for the manshof June are as follown. Compute the quality-control overhead cost to be assigned to the low-calorie breakfast product line for the mocth of June (1) usirg the traditional product conting system (direct labor cont is the cost driver), and (2) uning activity-based costere By what amount does the traditional product costing system understate or overstate the low-caloric breakfast line

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