to produce and sell 4,400 units of Regular and 2,500 units of Deluxe in 2021. Lotus has used for long time a single, facility-wide overhead allocation rate. Specifically, overhead costs are currently allocated to Regular and Deluxe 22 using direct labor costs as allocation basis, The controller of the company believes that Lotus can make 25 better process improvements if it uses disaggregated cost information. 24 Lotus Company budgeted information for 2021: 25 Regular Deluxe Total Direct costs: Direct labor C105,600 (105,060 C210,660 Direct materials E160,500 E310,250 C470.750 Overhead: Administration C25,126 Quality Inspections 227,060 Machine setup C171,180 Machine-hours (124,350 worked Overhead allocated E274,560 C273.156 E547.716 under current system (single rate) Number of units 4.40 2.500 Number of 5 35 inspections Number of setups 15 45 Machine-hours 3,960 3,000 Lotus operates at capacity. The proposed allocation bases (Le. cost drivers) for overhead are as follows: Activity Cost driver Administration Number of units Quality inspections Number of Inspections Machine setup Number of setups Machine-hours worked Machine-hours b) Compare and briefly explain differences in the allocated overhead costs of Regular under the current costing system and under the activity-based system as calculated in subquestion a). Also give one example of how activity-based costing can improve decision-making in organizations. (5 points)