Babytime, Inc., manufactures two products, Piglets and Rattles. Piglets are the more complex of the two products, requiring more direct labor time and more machine time per unit than Rattles. Manufacturing overhead is currently assigned to the products on the basis of direct labor hours. The company has gathered some activity information and is interested in the differences between its present costing method and activity-based costing. All overhead costs should be allocated to the products. The overhead cost pools and activity drivers are as follows: overhead Costs Activity Pool Total Driver Usage Setup Materials purchasing Machining/fabricating $265,000 116,000 136,000 $517,000 3,700 setups 2,960 purchase orders 27,400 machine hours Total overhead costs Other product information is as follows: Rattles Piglets Number of units produced Direct materials cost Direct labor cost Direct labor hours Setups Purchase orders Machine hours 45,000 $15.00 per unit 10,200 $30.00 per unit $14.00 per unit 21,000 $5.25 per unit 31,000 400 2,280 8,300 3,300 680 19,100