Carter, Inc. produces two different products, Product A and Product B. Carter uses a traditional volume-based costing system in which direct labor hours are the allocation base. Carter is considering switching to an ABC system by splitting its manufacturing overhead cost of $1,000,000 across three activities: Design, Production, and Inspection. Under the traditional volume-based costing system, the predetermined overhead rate is $2.50/direct labor hour. Under the ABC system, the rate for each activity and usage of the activity drivers are as follows: Design (Engineering Hours) Production Direct Labor Hours) Inspection (Batches) Activity Rate $ 600/hour $ 1.25 $ 500 Usage by Product A 200 100,000 300 Usage by Product B 300 300,000 100 Required: a. Calculate the indirect manufacturing costs assigned to Product A under the traditional costing system. Indirect Manufacturing Costs b. Calculate the indirect manufacturing costs assigned to Product A under the ABC system. Indirect Manufacturing Costs