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Answer the Following Questions Using the Information Below

Question 96

Multiple Choice

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.

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