Can you help tell me wrong B and C are incorrect? There were no spots for decimals. So I am guessing there so be no decimals in the answer.
I got B = 16,255.25 and C = 24,244.75 This was incorrect.
Whitman Enterprises uses a traditional -costing system to estimate quality- control costs for its Dragon product line. Costs are estimatedat 30%6 of direct- labor cost , and direct labor totaled $865,000 for the quarter just ended Management is contemplating a change toactivity – based costing , and has established three cost pools incoming material inspection in-process inspection , and final productcertification. Number of parts , number of units , and number of orders have been selected as the respective cost driversThe following data show the pool rates that have been calculated by the company along with the quantity of driver units for theDragon’s`Pool RateDriver Quantities8 . 50 per part20 . 5 parts8 . 17 per unit28 . 580 units128 . 80 per order95 ordersRequired :"A. Calculate the quarterly quality – control cost that is allocated to the Dragon product line under Whitman’s traditional -costing system .B. Calculate the quarterly quality – control cost that is allocated to the Dragon product line if activity- based costing is used .C. Does the traditional approach under – or overcost the product line ? By what amount ?"{} Answer is complete but not entirely correct .Quality – control cost$| 259.500 09Quality – control cost16, 255{^Undercost~}|$ 243, 2446}
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