Relative to the ABC system, the simple costing system overcosts interior doors and undercosts exterior doors. Interior doors require 1.72 machine-hours per unit (5,500 hours ÷ 3,200 units) while exterior doors require 2.5 machine-hours per unit (4,500 hours ÷ 1,800 units). In the simple-costing system, overhead costs are allocated to the interior and exterior doors on the basis of the machine-hours used by each type of door. The ABC study reveals that the ratio of the cost of production runs, material moves, and setups for each exterior door versus each interior door is even higher than the ratio of 2.5 to 1.72 machine-hours for each exterior relative to each interior door. This higher ratio results in higher indirect costs allocated to exterior doors relative to interior doors in the ABC system.