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please answer fast Docks Inc. has been using a traditional costing system and would like to try the Activity Based Costing system instead. The total
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Docks Inc. has been using a traditional costing system and would like to try the Activity Based Costing system instead. The total overhead of the company is $420,000 and the labour rate is $20 per hour. Under the traditional costing system, the overhead was allocated based on DL Hours and under the Activity Based Costing System, the following activities and cost pools were identified: Estimated Predetermined Activity OH rate 50,000 DL $5 per DL DL hours hours Hour 30,000 Machine machine $3 per Hours hours machine hour Number of 20,000 Orders orders $4 per order One of the clients of Docks Inc. required usage of 2,000DL hours; 3,000 machine hours, and placed 800 orders. Would this job have been over-costed or under-costed under the traditional system and by how muchStep by Step Solution
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