The Rapp Company has two major customers, who but their products at the amounts as the table below shows. The company spends equal money on customer A and B. The company wants to compare the customer margin of customer A and B. Which of the following statements is true? (Choose the figures that are closest) Both customers are just as profitable for the company because they buy the same total units under ABC. Customer margin for customer A is lower than that for B under ABC by: $20, 150 Customer margin for customer A is higher than that for B under ABC by: $ 20, 150 Customer margin for customer A is lower than that for B under ABC by: $ 19, 600 Customer margin for customer A is higher than that for B under ABC by: $ 19, 600 Regarding the production margins of the two products under the ABC system, which of the following statements is correct? (Choose the figures that are closest) The product margin of the LoEnd product is lower than that of the HiEnd product by $ 18,000 The product margin of the LoEnd product is higher than that of the HiEnd product by $ 118,000 The product margin of the LoEnd product is lower than that of the HiEnd product by $ 133,000 The product margin of the LoEnd product is higher than that of the HiEnd product by $ 133,000 None of the above. The next three questions are based on the following: Rapp Company is considering the adoption of an activity - based costing (ABC) system because the managers suspect that their traditional costing system distorts the product costs. This company produces and sells two products LoEnd and Hi End. Their traditional costing system uses direct labor hours (DLHs) as the allocation base for manufacturing overhead cost. The production managers decided that major activities arc Machine setups. Special Processing, and General factory and determined the costs for each activity. They also identified how many setups. MHs. and DLHs for each product requires. The company collected data for ABC as follows: Compared with the unit product cost calculated by the ABC system, what is the distortion (difference) created by the traditional costing system for HiEnd Product? Under the traditional costing system, the product is overcosted by $ 0.30 per unit. Under the traditional costing system, the product is undercosted by $ 0.30 per unit. Under the traditional costing system, the product is overcosted $ 0.25 per unit. Under the traditional costing system, the product is undercosted by $ 0.25 per unit. None of the above