General Mattress Company makes Memory Foam mattresses, a mass-market high-volume product, and Magnetic Levitation mattresses, a premium low-volume product. The company uses a traditional cost allocation with a single cost pool. It is planning to implement activity-based costing (ABC). After implementing ABC, the company will likely find that the traditional cost allocation: a. overestimated the true capacity costs of Memory Foam and underestimated the true capacity costs of Magnetic Levitation
b. overestimated the true capacity costs of Memory Foam and overestimated the true capacity costs of Magnetic Levitation
c. underestimated the true capacity costs of Memory Foam and underestimated the true capacity costs of Magnetic Levitation
d. not enough information
e. underestimated the true capacity costs of Memory Foam and overestimated the true capacity costs of Magnetic Levitation