Answer the following questions using the information below:
Chess Woods Limited produces two products: wooden chess pieces and wooden inlaid chess boards.Under their traditional cost system using one cost driver (direct manufacturing labour hours),the cost of a set of wooden chess pieces is $325.00.An analysis of the activities and their costs revealed that three cost drivers would be used under a new ABC system.These cost drivers would be equipment usage,storage area for the material and types of wood used.The new cost of a set of chess pieces was determined to be $298.00 per set.
-The total amount of indirect cost assigned to produce chess pieces using the traditional method is ________ the total amount assigned using ABC.
A)more than
B)identical to
C)less than
D)None of these answers are correct.

Question

Quizplus · Accepted Answer

The traditional cost system assigned a higher cost ($325.00) to the chess pieces compared to the ABC system ($298.00), indicating that the total amount of indirect cost assigned using the traditional method is more than the amount assigned using ABC.

Answer the Following Questions Using the Information Below