Salem Manufacturing currently uses a plantwide rate based on Direct Labour hours. It has two products, the Header and the Tailer. The Tailer is the more complex product, requiring 1 hour of direct labour time per unit. As this production process is highly automated, it uses considerable machine hours. The Header is a more simple product, requiring only 0.75 direct labour hours and relatively few machine hours. Despite the popularity of the Tailer, profits have been declining. Management believes that there may be a problem with the costing system. Details for the two products are: Units produced DM DL (at $12 per hour) Tailer 10,000 $ 48.00 $ 12.00 Header 40,000 $ 35.00 $ 9.00 Management estimates Thet it will spend $1M in manufacturing overhead in the current year. If management decides to change to ABC costing, the following data would be relevant: Activity Activity base Estimated O/H Maintaining RM inventory # of part types $ 180,000 Processing purchase orders # of purchase orders 90,000 Quality control # of test runs 230,000 Machine related Machime hours 500,000 The following estimated activity data is available Activity base # of part types # of purchase orders # of test runs Machime hours Expected Activity Trailer Header 150 75 200 800 3,250 2,500 6,000 4,000 Required: 1. Assuming the company used a plantwide rate based on DL hours, calculate the estimated cost for each product, 2. Assuming the company uses ABC costing, calculate the estimated cost for each product.