The Davis Corporation's activity-based costing system has 3 activity cost pools: Machining, Setting Up, and Other. The company's overhead costs have already been allocated to these cost pools as follows:

Machining	$15,200
Setting Up	$44,800
Other	$16,000

Cost in the Machining cost pool are assigned to products based on machine hours (MHs) and costs in the Setting Up cost pool are assigned to products based on the number of batches. Costs in the Other cost pool are not assigned to products. the following table shows the machine hours and number of batches associated with each of the company's two products:

	MHs	Batches
Product E8	2,000	800
Product V8	8,000	200
Total	10,000	1,000

Additional data concerning the company's products appear below:

	Product E8	Product V8
Sales (total)	$220,700	$165,500
Direct materials (total)	$78,600	$83,100
Direct Labor (total)	$89,600	$58,000

1. Calculate the activity rate for each activity cost pool using activity-based costing.

2. Determine the amount of overhead cost that would be assigned for each product using activity-based costing.

3. Determine the product margins for each product using activity-based costing.