Elexis, Inc. produces two different products, Product A and Product B. Elexis uses a plant-wide volume-based costing system in which machine hours are the activity base (cost driver). Elexis 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 plant-wide volume-based costing system, the predetermined overhead rate is $2.50/machine hour. Under the ABC system, the rate for each activity and usage of the activity drivers are as follows: Activity Design Machining Inspection Activity Rate $600/design hour $1.25/machine hour $500/batch Actual Activity Usage Product A Product B 300 200 300,000 100,000 100 300 Which product is under-costed and which is over-costed under the plant-wide volume-based cost system compared to ABC? Product A is under-costed and Product B is over-costed. O Product A is over-costed and Product B is under-costed. Both Product A and Product B are over-costed Both Product A and Product B are under-costed