3. Elk Island Company manufactures a line of high-end exercise equipment of commercial quality. Assume that the chief accountant has proposed changing from a traditional costing system to an activity-based costing system. The financial vice-president is not convinced, so she requests that the next large order for equipment be costed under both systems for purposes of comparison and analysis. An order from AlbertaBisons, Inc., for 150 low-impact treadmills is received and is identified as the order to be subjected to dual costing. The following cost data relate to the order from Alberta Bisons, Inc.: Data relevant to both costing systems: Direct materials $ 55,500 Direct labor hours 820 Direct labor rate per hour $ 18.00 Data relevant to the traditional costing system: Predetermined overhead rate is 300 % of direct labor cost. Data relevant to the activity-based costing system: Activity cost pools Cost driver Activity-based Expected use of cost overhead rate drivers per Treadmill Engineering Engineering design $ 30 per hour 330 hours Machine set-up Set-ups $ 200 per set-up 22 Machining Machine hours $ 25 per hour 732 Number of $ 8 per Assembly 1,450 subassemblies subassembly Packing/shipping Packaging and shipping $ 15 per hour 152 hours Building occupancy Machine hours $ 6 per hour 732 Compute the cost per unit of the treadmill under (a) the traditional costing system (b) the activity-based costing system