1. Calculate the allocation rates for each cost driver using ABC.

2. Use the traditional costing approach to calculate the total cost and the unit cost of the stick and collapsible umbrellas.  

3. Use ABC to compute the total costs and the unit cost for the stick and collapsible umbrellas.  

4.Compute the difference between the product cost per stick and collapsible umbrellas using the unit cost that you computed with the traditional approach and the one that you computed using ABC.  

 

Based on your calculations from steps 1–4, respond to Parts A through C in Section IV as outlined in the Final Project Guidelines and Rubric document.