Case 2 Activity-based Costing (ABC) vs. Time-based Costing Hello company manufactures three products, A, B and C. Forecast data concerning overheads (indirect costs) of the products for the next period as follows 120 Forecast output100 (units) Machine hours per3 unit Number customer orders Number of quality 20 control inspections Number engineering consultancies Areas workshops (m 150 2 of 10 15 25 10 30 of 200 500 300 Cost pools and related cost drivers Cost pool S Machine operating 24,000 Order processing 5,000 Quality control 6,000 Engineering consultancy 3,000 Rent of the campus 10,000 Cost driver Machine hours No. of customer orders No. of quality control inspections No. of engineer consultancies Areas of workshop:s Requirea Calculate the overhead cost to be absorbed by each of the products using the following absorption costing methods (1) A traditional absorption method based on a machine hour rate (2) An activity-based method, using the relevant cost drivers to trace overhead costs to the individual products