Kaypo Company manufactures two medical sterilizers, Standard Model and Enhanced Model, and applies overhead based on direct-labour hour. Anticipated overhead and direct labour time for the upcoming accounting period are $864,000 and 36,000 hours respectively. The following data relate to the two models: Kaypo Company's overhead of $864,000 can be identified with three major activities: order processing, machine processing and product inspection. These activities are driven by number of orders processed, machine hours worked and inspection hours respectively. Data relevant to these activities are as below: The top management of Kaypo Company is very concerned about declining profitability despite a healthy increase in sales volume. The decrease in income is especially puzzling because the company recently undertook a massive plant renovation during which new, highly automated machinery was installed. The machinery was expected to produce significant operating efficiencies. b. Calculate the total activity-based overhead allocated to Standard Model and Enhanced Model. c. Assuming use of activity-based costing, compute the unit manufacturing costs of Standard Model and Enhanced Model if the expected production volume is attained. d. By using direct labor hour as an application base, which model is under costed and which model is over costed? Indicate and calculate the amount of the cost distortion per unit for each model