The Halloway Corporation manufactures oxygen tanks for deepsea divers. Information regarding resources for the month of March follows.

In addition, $22,000 was spent on 800 quality inspections with a cost driver rate of $25, and $8,000 was spent on 200 customer-service cost driver units with a cost driver rate of $30. Sales for March were $350,000. Management has requested that you
a. Prepare a traditional income statement.
b. Prepare an activity-based income statement.
c. Write a short report explaining why the activity-based income statement provides better information to managers. Use information for Halloway Corporation inexamples.

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Resources Used Marketing Depreciation Outside Contracts Materials Setups Energy Parts Management $28,000 24,000 12,000 60,000 14,000 20,000 15,000 Resources Supplied $30,000 40,000 12,000 60,000 20,000 21,000 16,000 12,000 7,000 14,000 26,000 Engineeng Changes 10.000 Short-term Labor Long-term Labor Administrative 7,000 10,000 20,000