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Comparing Two Products under Traditional and Activity-Based Costing

Compare two projects under development by the same company. The following are a few aspects of each products development process relevant to costs.

Product S		Product T
Requires 3,200 hours of testing		Requires 800 hours of testing
Requires 4,830 units of computing power		Requires 2,070 units of computing power
Requires 20 developer hours to implement		Requires 80 developer hours to implement

Cost Items	Cost of Each Activity
Testing:	$27,600
Computing power:	$41,400
Developer hourly cost:	$15 per hour

Traditional Costing

Traditional costing would take the proportion of a direct cost, such as direct labor hours, and use it as the basis for allocating overhead costs, such as computing power and testing. In the following table, use developer hours as the basis for assigning overhead costs (computing and developer costs) to each project. If required, round your answers to the nearest dollar.

Product S			Product T
Percentage of developer hours	20%		Percentage of developer hours	80%
Testing cost	$fill in the blank ba91d90d3017fe1_1		Testing cost	$fill in the blank ba91d90d3017fe1_2
Computing cost	$fill in the blank ba91d90d3017fe1_3		Computing cost	$fill in the blank ba91d90d3017fe1_4
Developer cost	$fill in the blank ba91d90d3017fe1_5		Developer cost	$fill in the blank ba91d90d3017fe1_6
Total cost	$fill in the blank ba91d90d3017fe1_7		Total cost	$fill in the blank ba91d90d3017fe1_8