The controller for Norton Machining has established the following overhead cost pools and cost drivers: Overhead Cost Pool Machine setups Material handling Quality control inspection Other overhead costs Total Budgeted Overhead Cost Cost Driver $240,000 Number of setups $90,000 Units of raw material $48,000 Number of inspections $160,000 Machine hours $538,000 Budgeted Level for Cost Driver Pool Rate $1,200 per setup 60,000 units $1.50 per unit 1,200 inspections S40 per inspection 20,000 machine hours $8 per machine hour 200 setups Overhad Cost Pool Machine setups Material handling Quality control Other overhead Order No. 715 has the following production requirements: Machine setups: 7 Raw material: 11,200 units Inspections: 16 Machine hours: 850 200 setups Machine schups Material handling Quality control Other overhead 60,000 units 1,200 inspections 20,000 machine hours $1,200 per setup $1.50 per unit $40 per inspection $8 per machine hour Order No. 715 has the following production requirements: Machine setups: 7 Raw material: 11,200 units Inspections: 16 Machine hours: 850 Required: 1. Compute the total overhead that should be assigned to order no. 715 by using activity-based costing. 2. Suppose that Norton 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. 3. Discuss the merits of an activity-based costing system in comparison with a traditional costing system