1. The traditional product-costing system:

A.overcost the Satin Sheen product line with respect to quality- control costs by $630.

undercost the SatinMac cosmetics has used a traditional cost accounting system to apply quality -control costs uniformly to all products at a rate of 20% of direct labor cost. Monthly direct-labor costs for Satin Sheen makeup is $28,000. In an attempt to more equitably distribute quality-control costs, management is considering activity- based costing. The monthly data shown in the following chart have been gathered for Satin Sheen makeup.

Activity Cost Pool

Cost Driver

Pool Rates

Quantity of Driver for Satin Sheen

Incoming material inspection

Type of material

$ 12 per type

15 types

In-process inspection

Number of units

0.25 per unit

15,000 units

Product certification

Per order

77 per order

20orders

1. The monthly quality-control cost to be assigned to the Satin Sheen product line under the Activity based costing system is:

A. $4,410

B. $5,470

C. $4,513

D. $4,500

B.Sheen product line with respect to quality- control costs by $630

C.overcost the Satin Sheen product line with respect to quality- control costs by $130.

D.undercost the Satin Sheen product line with respect to quality- control costs by $130