Question - Ayala Inc. has conducted the following analysis related to its product lines, using a traditional costing system (volume-based) and an activity-based costing system. Both the traditional and the activity-based costing systems include direct materials and direct labor costs.
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|
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Total Costs
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|
Products
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Sales Revenue
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Traditional
|
ABC
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Product 540X
|
$212,000
|
$58,000
|
$45,900
|
|
Product 137Y
|
165,000
|
50,000
|
39,000
|
|
Product 249S
|
82,000
|
20,000
|
43,100
|
Required - For each product line, compute the operating income using the traditional costing system.