Use the 7-Step Cost Assignment Process to calculate total manufacturing costs under: Traditional (volume-based) costing system Activity-Based costing system (start with Step 3) What are the primary differences between the two methods? In this instance, which methods do you think more fairly allocates overhead costs? Explain. (minimum 2-3 sentences) Crazy Skates manufactures and sells three types of skates: Basic Roller, Beginner Inline, and Professional Inline. Based on budgetary projections, the information listed below is available:

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Basic Beg. Inline Pro Inline Projected sales in units 200 350 150 PER UNIT DATA: $20.00 $2.50 $1.80 $35.00 $4.00 $4.20 $50.00 $7.50 $9.00 Selling price Direct materials Direct labor Direct labor hours 0.15 0.35 0.75 Machine hours 1.20 2.00 2.20 Inspections 4 7 5 Total overhead costs and activity levels for the year are estimated as follows: Activity Overhead costs Activity levels Direct labor 265 labor hours $6,800.00 $3,400.00 $10,200.00 Machine hours 1,270 mach hours Inspections 16 inspections Basic Beg. Inline Pro Inline Projected sales in units 200 350 150 PER UNIT DATA: $20.00 $2.50 $1.80 $35.00 $4.00 $4.20 $50.00 $7.50 $9.00 Selling price Direct materials Direct labor Direct labor hours 0.15 0.35 0.75 Machine hours 1.20 2.00 2.20 Inspections 4 7 5 Total overhead costs and activity levels for the year are estimated as follows: Activity Overhead costs Activity levels Direct labor 265 labor hours $6,800.00 $3,400.00 $10,200.00 Machine hours 1,270 mach hours Inspections 16 inspections

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3 The primary difference between traditional method and ABC method of all... View the full answer