Extracts from cost information of Hebar Corp.:

	Simple L3 Pack	Complex L7 Pack	Total
Setup cost allocated using direct labor-hours	$19,250	$5,750	$25,000
Setup cost allocated using setup-hours	$13,400	$11,600	$25,000

Assuming that setup-hours is considered a more effective cost drive for allocating setup costs than direct labor-hours. Which of the following statements is true of Hebar's setup costs under traditional costing?

A. L7 pack is undercosted by $5,750

B. L3 pack is overcosted by $5,850

C. L3 pack is undercosted by $5,850

D. L7 pack is overcosted by $5,850