E4-12 Assigning Costs Using Traditional System, ABC System [LO 4-1, 4-3, 4-4, 4-5, 4-6] Bunker makes two types of briefcase, fabric and leather. The company is currently using a traditional costing system with labor hours as the cost driver but is considering switching to an activity-based costing system. In preparation for the possible switch, Bunker has identified two activity cost pools: materials handling and setup. Pertinent data follow:

	Fabric Case		Leather Case
Number of labor hours	15,000		9,000
Number of material moves	440		660
Number of setups	40		80

Total estimated overhead costs are $150,000, of which $110,000 is assigned to the materials handling cost pool and $40,000 is assigned to the setup cost pool.

Required :

1.

Calculate the overhead assigned to the fabric case using the traditional costing system based on direct labor hours. (Do not round intermediate calculations and round your final answer to the nearest whole dollar amount.)

Overhead Assigned

?

2.	Calculate the overhead assigned to the fabric case using ABC. (Round activity rates or activity proportions to four decimal placesand round your final answer to 2 decimal place.)

Overhead Assigned ?

3.

Was the fabric case over- or undercosted by the traditional cost system compared to ABC?

Fabric Case ?

?