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please solve in excel/table format if possible. thank you. (traditional UUSUJ - Upelating MCMC (ULUNUI CUL). (UU U U U UIJ.) (d) Provide a rationale
please solve in excel/table format if possible. thank you.
(traditional UUSUJ - Upelating MCMC (ULUNUI CUL). (UU U U U UIJ.) (d) Provide a rationale as to why the costs for Product 540X are approximately the same using either the traditional or activity-based costing system. E17-3 EcoFabrics has budgeted overhead costs of $945,000. It has allocated overhead on a plantwide basis to its two products (wool and cotton) using direct labor hours which are estimated to be 450,000 for the current year. The company has decided to experiment with activity-based costing and has created two activity cost pools and related activity cost drivers. These two cost pools are cutting (cost driver is machine hours) and design (cost driver is number of setups). Overhead allocated to the cutting cost pool is $360,000, and $585,000 is allocated to the design cost pool. Additional information related to these pools is as follows. Wool 100,000 1,000 Cotton 100,000 Machine hours Number of setups Total 200,000 1,500 500 Instructions (a) Determine the amount of overhead allocated to the wool product line and the cotton product line using activity-based costing. (b) What amount of overhead would be allocated to the wool and cotton product lines using the traditional approach, assuming direct labor hours were incurred evenly between the wool and cotton? How does this compare with the amount allocated using ABC in part (a) Step by Step Solution
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