Acme Company manufactures three product lines, J, K and L. A…
Acme Company manufactures three product lines, J, K and L. Acme operates separate production lines for each product. The estimated total annual manufacturing overhead costs and estimated total annual direct labor hours (DLHs) associated with each of these production lines are as follows: Product J ($260,000 costs, 8,000 DLHs), Product K ($364,000 costs, 7,000 DLHs), and Product L ($432,000 costs, 9,000 DLHs). If Acme applies overhead costs to jobs using a single plantwide rate based on direct labor hours, which products are under-costed or over-costed? J and K are under-costed, whereas L is over-costed L is under-costed, whereas J and K are over-costed J is under-costed, whereas K and L are over-costed K and L are under-costed, whereas J is over-costed