Acme Inc. manufactures towels which it sells to retailers. Acme operates seperate production lines for Cotton towels, Linen towels, and Synthetic towels. The estimated annual manufacturing overhead costs and machine hours associated with each of these production lines are as follows: Production line Cotton towels Linen towels Overhead costs Synthetic towels Totals $2,500,000 Machine hours $3,000,000 $1,000,000 $6,500,000 10,000 15,000 15,000 40,000 If Acme applies overhead costs to jobs using a single plantwide rate based on machine hours, which products are over-costed or under-costed? Linen and Synthetic are under-costed, whereas Cotton is over-costed Cotton and Linen are under-costed, whereas Synthetic is over-costed Cotton is under-costed, whereas Linen and Synthetic are over-costed Synthetic is under-costed, whereas Cotton and Linen are over-costed None of the above

lines for Cotton towels, Linen towels, and Synthetic towels The extmad ima mating overhead costs and machine hours associated with each d thesa vrouctin ines in w ik