our answer is incorrect. Try again. Waterways is thinking of mass-producing one of its special-order sprinklers. To do so would increase variable costs for all sprinklers by an average of $0.70 per unit. The company also estimates that this change could increase the overall number of sprinklers sold by 10%, and the average sales price would increase $0.20 per unit. Waterways currently sells 497,000 sprinkler units at an average selling price of $25.60. The manufacturing costs are $6,925,390 variable and $1,733,086 fixed. Selling and administrative costs are $2,617,010 variable and $783,290 fixed. If the average sales price per sprinkler unit did not increase when the company began mass-producing the special-order sprinkler, what would be the effect on the company? (Round answers to 0 decimal places, e.g. 5% or 2,520.) X x Contribution margin ratio by % X X Profit by Click if you would like to Show Work for this question: Open Show Work Exercise 4-10 (Video) Kragan Clothing Company manufactures its own designed and labeled athletic wear and sells its products through catalog sales and retail outlets. While Kragan has for years used activity-based costing in its manufacturing activities, it has always used traditional costing in assigning its selling costs to its product lines. Selling costs have traditionally been assigned to Kragan's product lines at a rate of 70% of direct materials costs. Its direct materials costs for the month of March for Kragan's "high-intensity" line of athletic wear are $392,000. 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 Rate Number of Cost Drivers Used per Activity Activity Cost Pools Cost Drivers Sales commissions Dollar sales $900,000 Minutes 300 Column inches Advertising-TV Advertising-Internet Catalogs Cost of catalog sales Credit and collection $0.05 per dollar sales $300 per minute $10 per column inch $2.50 per catalog $1 per catalog order $0.03 per dollar sales Catalogs mailed Catalog orders 2,200 62,500 8,750 $900,000 Dollar sales x Your answer is incorrect. Try again. 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 (direct materials cost is the cost driver), and (2) using activity-based costing. Traditional product costing Activity-based costing X Selling cost to be assigned 280000 326000 x Your answer is incorrect. Try again. 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 (direct materials cost is the cost driver), and (2) using activity-based costing. Traditional product costing Activity-based costing X Selling cost to be assigned 280000 326000 LINK TO TEXT LINK TO TEXT LINK TO TEXT VIDEO: SIMILAR EXERCISE Your answer is partially correct. Try again. By what amount does the traditional product costing system undercost or overcost the "high-intensity product line? X 46000 Undercost v