TER VER At 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 $405,000. 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. Exerc Overhead Number of Cost Drivers Activity Cost Pools Cost Drivers Rate Used per Activity Kragat ill outre years Sales commissions Dollar sales $0.05 per dollar sales $936,000 produc havet Advertising - TV Minutes $300 per minute 280 onth of high- elating line of Advertising --Internet Column inches $10 per column inch 2,200 Catalogs Catalogs mailed $2.50 per catalog 63,800 Cost of catalog sales Acti Catalog orders 8,800 $1 per catalog order Credit and collection Dollar sales $0.03 per dollar sales $936,000 Sales Adver Compute the selling costs to be assigned to the "high-intensity" line of athletic wear for the month of March (1) using the Adver traditional product costing system (direct materials cost is the cost driver), and (2) using activity-based costing. Catal Traditional product costing Activity-based costing Costa Credit Selling cost to be assigned $ By what amount does the traditional product costing system undercost or overcost the "high-intensity product line? Compi $ Iduct costing mater Question Attempts: Unlimited Selling