Dodo Airlines produces two products for it's island travel passengers. Peanuts (A) and Pretzels (B). Dodo airlines uses a traditional absorption or volume-based costing system. The allocation base used is direct labor hours. Dodo Airlines is considering switching to an Activity Based Costing (ABC) system by splitting its manufacturing overhead cost of $500,000 across three activities: Setup, Production, and Bagging. Under the traditional volume-based costing system, the predetermined overhead rate is $5.00/direct labor hour. Under the ABC system, the rate for each activity and usage of the activity drivers are as follows: Usage by Pretzles Setup (Batches) Production (Direct Labor Hours) Bagging (Machine Hours) Activity Usage by Peanuts (A) Rate $ 100/hour 190 $3.00 42,000 $ 660 28 310 58,000 160 Required: a. Calculate the indirect manufacturing costs assigned to Peanuts under the traditional costing system. Indirect Manufacturing Costs b. Calculate the indirect manufacturing costs assigned to Pretzles under the traditional costing system, Indirect Manufacturing Costs c. Calculate the indirect manufacturing costs assigned to Peanuts under the ABC system Indirect Manufacturing Costs 5:50 d. Calculate the indirect manufacturing costs assigned to Pretzles under the ABC system. Indirect Manufacturing Costs e. Which product is under-costed and which is over.costed under the volume-based cost system compared to ABC? Product A Product B