QUESTION $2(25$ MARKS$)$

$($a$)$ What is activity$-$based costing $($ABC$),$ and how can it improve an organization's costing system?

$(5$ marks$)$

$($b$)$ EyeOnYou Sdn$.$ Bhd$.($EOY$)$ manufactures protective eyewear for use in commercial and home applications. The product is also used by hunters, home woodworking hobbyists, and in other applications. The firm has two main product lines$-$the highest$-$quality product is called Vision, and a low$-$cost$,$ value version is called Fancy. Information on the factory conversion costs for EOY is as follows:

$\backslash$table$[[$Item$,$Factory Costs $($RM$)],[$Salaries$,850,000],[$Supplies$,150,000],[$Factory expense,$550,{000}_{?}$