Problem 5-49 Activity-Based Costing; Product Promotion (LO 5-1, 5-2, 5-4, 5-5) Maxey & Sons manufactures two types of storage cabinets-Type A and Type B-and applies manufacturing overhead to all units at the rate of $124 per machine hour. Production information follows Anticipated volume (units) Direct-material cost per unit Direct-labor cost per unit Type A TypeB 46,500 $3045 35 24,800 35 The controller, who is studying the use of activity-based costing, has determined that the firm's overhead can be identified with three activities: manufacturing setups, machine processing, and product shipping. Data on the number of setups, machine hours, and outgoing shipments, which are the activities' three respective cost drivers, follow Total Setups Machine hours Outgoing shipments Type A 144 49,600 200 Type B 104 69,750 150 248 119,350 350 The firm's total overhead of $14,799,400 is subdivided as follows: manufacturing setups, $3,228,960; machine processing $8,879,640; and product shipping, $2,690,800 Required 1. Compute the unit manufacturing cost of Type A and Type B storage cabinets by using the company's current overhead costing procedures 2. Compute the unit manufacturing cost of Type A and Type B storage cabinets by using activity-based costing 3. Is the cost of the Type A storage cabinet overstated or understated (i.e., distorted) by the use of machine hours to allocate total manufacturing overhead to production? Bv how much