17.4 Assign overhead using traditional costing and ABC Itex Inc. manufactures two products: car wheels and truck wheels. To determine the amount of overhead to ssign to each product line, the controller, Robert Hermann, has developed the following information. otal estimated overhead costs for the two product lines are $770,000. nstructions a. Compute the overhead cost assigned to the car wheels and truck wheels, assuming that direct labor hours is used to assign overhead costs. b. Hermann is not satisfied with the traditional method of allocating overhead because he believes that most of the overhead costs relate to the truck wheels product line because of its complexity. He therefore develops the following three activity cost pools and related cost drivers to better understand these costs. Compute the activity-based overhead rates for these three cost pools. c. Compute the cost that is assigned to the car wheels and truck wheels product lines using an activitybased costing system, given the following information. IOTE: Enter a formula, a cell reference, or a value (if you are unable to reference a cell), into the yellow haded input cells. a. Drect labor hours for car wheels Drect labor hours for truck wheels Total dinect labor hours Total estmated overtiead Total direct labor hours OH niteriH Overhead assigned: Drect labor houn Overiead rale f diect labor hout Total OH assigned Car Wheels Activily Cost Pool Seting up machines Asserbing Inspection Total cost assigned Truck Wheels Activiry Cost Pool Seting up machines Astembing Inspection Total cost assigned \begin{tabular}{|l|} \hline \\ \hline \\ \hline \end{tabular} \begin{tabular}{|l|} \hline \\ \hline \end{tabular} Expected Use Truck whoels Expected Use of cost Diver x ABCOH x ABCOH Cost - Assignod Cost - Assigned d. What do you beleve flamain should do