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Maxey & Sons manufactures two types of storage cabinetsType A and Type Band applies manufacturing overhead to all units at the rate of $148 per machine hour. Production information follows. Descriptions Type A Type B Anticipated volume (units) 29,600 55,500 Direct-material cost per unit $ 42 $ 63 Direct-labor cost per unit 47 47 The controller, who is studying the use of activity-based costing, has determined that the firms 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. Descriptions Type A Type B Total Setups 168 128 296 Machine hours 59,200 83,250 142,450 Outgoing shipments 200 150 350 The firms total overhead of $21,082,600 is subdivided as follows: manufacturing setups, $4,599,840; machine processing, $12,649,560; and product shipping, $3,833,200. Required: Compute the unit manufacturing cost of Type A and Type B storage cabinets by using the companys current overhead costing procedures. Compute the unit manufacturing cost of Type A and Type B storage cabinets by using activity-based costing. 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? By how much? Assume that the current selling price of a Type A storage cabinet is $443.00 and the marketing manager is contemplating a $47 discount to stimulate volume. Is this discount advisable? Please help me

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