how to indicate whether the cost is a direct cost or an indirect cost in exhibit 3

\\individual Case Assignment\\ }) C - 2403 . polf 10 File : / / / Ci /Users / SIMMER9620 AULAKH / Desktop / C - 2403 . poff\\ *\\} individual Case Assignment\\ [ Log in - Course Hero MY] Spam ( 37 )_ aulakhsimer zz z\\ + V The company used a simple , traditional overhead allocation system to allocate both manufacturing and nonmanufacturing costs based on the number of units . In other words , each gym bag it made was allocated the same amount of overhead . "It's hard to believe our new custom bag only costs $10 more to make than our This document is authorized for use only by simerde bread - and- butter basic gym bag . Do you think that makes sense ? I feel like every time I stop by the shop , there is so much effort being put into getting small orders of custom bags out the door . I'm wondering if it's worth it . " Jones asked West one evening during their friendly squash match . West replied , "" I've been wondering that same thing . I took a managerial accounting course once , and we learned about something called activity - based Please do not copy or redistribute . Contact permissions @ dardenbusiness, costing . I don't remember much about it , but it is supposed to help you estimate the costs that your products are causing you to incur , based on their use of the activities that are going on in the process . If a product takes a lot of your resources because you have to devote a lot of activities to it , this system helps make sure that gets taken into account when you determine the cost of your products . Maybe this is something worth looking into . " After finishing their squash game , they agreed to spend the next few evenings after work looking into issues around overhead allocation . Rather than meeting at the gym for their regular workout , the next evening they met at West's apartment , ordered pizza , and started their analysis . They started by putting together a description of each of the company's cost categories ( Exhibit 3 ) . They knew the amount of direct material , direct labor , and sales commission associated with basic gymn bags and the amount associated with custom gym bags ( Exhibit 2 ) . But they couldn't say the same thing about the remaining costs . Then they realized that those costs monthly overhead costs by cost category ) . were the overhead costs that had to be allocated to determine the cost of each gym bag ( Exhibit 4 presents O Type here to search