Requirement $4.$ Explain why costs are different in the two costing systems. Include an indication of which costs you think are most accurate and why.

The order from

HondaHonda

requires a relatively

low amount of receiving, quality control, and shipping

resources compared to the relative amount of labor required. This means its indirect production costs are

expensive

relative to the labor required$$ and, as a$$ result, the total estimated cost of the job under the ABC system is

higher

than the estimated cost of the job under the traditional cost system.