Carter, Inc. produces two different products, Product A and Product B. Carter uses a traditional volume-bas direct labor hours are the allocation base. Carter is considering switching to an ABC system by splitting its cost of $1,385,000 across three activities: Design, Production, and Inspection. Under the traditional volume predetermined overhead rate is $2.77/direct labor hour. Under the ABC system, the rate for each activity ai drivers are as follows: Design (Engineering Hours) Production (Direct Labor Hours) Inspection (Batches) Activity Rate Usage by Product A $ 700/hour $1.35 $ 600 200 200,000 400 Usage by Product B 300 300,000 200 Required: a. Calculate the indirect manufacturing costs assigned to Product A under the traditional costing system. Indirect Manufacturing Costs d. Calculate the indirect manufacturing costs assigned to Product B under the ABC system. Indirect Manufacturing Costs b. Calculate the indirect manufacturing costs assigned to Product B under the traditional costing system. Indirect Manufacturing Costs e. Which product is under-costed and which is over-costed under the volume-based cost system compared to ABC? c. Calculate the indirect manufacturing costs assigned to Product A under the ABC system. Indirect Manufacturing Costs Product A Product B