order no. 715 by using activity-based costing. B. Suppose that Wolfe were to use a single, predetermined overhead rate based on machine hours. Compute the rate per hour and the total overhead assigned to order no. 715. C. Discuss the merits of an activity-based costing system in comparison with a traditional costing system. 6. (6 points) Baker, Inc., produces a number of components that are used in home theater systems. Fred Briggs, head of the company's market research department, has identified the need for a new component that will most likely sell for $75. Projected volume levels are anticipated to reach 28,000 units in the first year, as several firmly entrenched competitors will be introducing a similar product in the nottoo-distant future. Conversations with Baker's engineers and reviews of cost accounting data related to similar products that the company manufactures resulted in the following cost estimates for the new component: Baker currently uses costplus pricing and adds a 20% markup on total production cost to arrive at what is normally a competitive selling price. Required: A \"That it: flu: :Infirinnfnr'l callinri nrir'n n'F that hour r-nrnnnnnnf