$($Need Explantion, TY$)$ Carter, Incorporated, uses a traditional volume$-$based costing system in which direct labor hours are the allocation base. Carter

produces two products: Product A$,$ which uses $100,000$ direct labor hours, and Product B$,$ which uses $300,000$ direct labor hours.

Carter is considering switching to an ABC system by splitting its manufacturing overhead cost of $$1,168,000$ across three activities:

Design, Production, and Inspection. Under the traditional volume$-$based costing system, the predetermined overhead rate is $$2\mathrm{.}92$ per

direct labor hour. Under the ABC system, the cost of each activity and proportion of the cost drivers used by each product are as

follows:

Required:

a$.$ Calculate the indirect manufacturing costs assigned to Product A under the traditional costing system.

b$.$ Calculate the indirect manufacturing costs assigned to Product B under the traditional costing system.

c$.$ Calculate the indirect manufacturing costs assigned to Product A under the ABC system.

d$.$ Calculate the indirect manufacturing costs assigned to Product $B$ under the ABC system.

e$.$ Which product is undercosted and which is overcosted under the volume$-$based cost system compared to ABC?

Complete this question by entering your answers in the tabs below.

Calculate the indirect manufacturing costs assigned to Product A under the traditional costing system.