2. Given the following information: Activity Allocation base Purchasing Purchase orders Receiving Shipments received Machine Setups Quality control Inspections Overhead cost $400,000 100,000 400,000 150,000 Total volume of activity 8,000 25,000 4,000 7,500 Set ups Employees worked a total of 10,000 direct labor hours. A. Determine the overhead rate using the traditional overhead allocation method based on Direct labor hours 3. Determine the overhead rate for each of the activities assuming that activity based cost is used Assuming the following specifications: Direct labor hours 7 Purchase orders 7 Shipments received 10 3 Inspections 3 Set ups C. Determine the overhead applied using the traditional method D. Determine the overhead applied using Activity based costing