JUST NEED HELP WITH PART C (PLEASE SHOW WORK SO I CAN CHECK MINE)

Saddle Inc. has two types of handbags: standard and custom. The controller has decided to use a plantwide overhead rate based on direct labor costs. The president has heard of activity-based costing and wants to see how the results would differ if this system were used. Two activity cost pools were developed: machining and machine setup. Presented below is information related to the companys operations.

		Standard		Custom
Direct labor costs		$50,000		$100,000
Machine hours		1,200		1,200
Setup hours		90		390

Total estimated overhead costs are $292,800. Overhead cost allocated to the machining activity cost pool is $192,000, and $100,800 is allocated to the machine setup activity cost pool.

(a)

Correct answer iconYour answer is correct.

Compute the overhead rate using the traditional (plantwide) approach. (Round answer to 2 decimal places, e.g. 12.25.)

Predetermined overhead rate

enter the overhead rate as percentage of direct labor cost rounded to 2 decimal places

% of direct labor cost

(b)

Correct answer iconYour answer is correct.

Compute the overhead rates using the activity-based costing approach.

Machining		$enter a dollar amount per machine hour	per machine hour
Machine setup		$enter a dollar amount per setup hour	per setup hour

(c)

Determine the difference in allocation between the two approaches.

Traditional costing
Standard		$enter a dollar amount
Custom		$enter a dollar amount
Activity-based costing
Standard		$enter a dollar amount
Custom		$enter a dollar amount