Kunkel Company makes two products and uses a conventional costing system in which a single plantwide predetermined overhead rate is computed based on direct labor-hours. Data for the two products for the upcoming year follow: Mercon Wurcon Direct materials cost per unit $ 11.00 $ 9.00 Direct labor cost per unit $ 3.00 $ 4.00 Direct labor-hours per unit 1.00 7.50 Number of units produced 2,000 4,000 These products are customized to some degree for specific customers. Required: 1. The company's manufacturing overhead costs for the year are expected to be $1,280,000. Using the company's conventional costing system, compute the unit product costs for the two products. 2. Management is considering an activity-based costing system in which half of the overhead would continue to be allocated on the basis of direct labor-hours and half would be allocated on the basis of engineering design time. This time is expected to be distributed as follows during the upcoming year: Mercon Wurcon Total Engineering design time (in hours) 4,000 4,000 8,000 Compute the unit product costs for the two products using the proposed ABC system.