Bonita, Inc. decided to implement the activity-based costing approach and was quite successful in its use. However, the controller is wondering if instead of only two activity cost pools, they should expand to three activity cost pools based on the following: Family Model Deluxe Model Direct labor costs $72,600 $145,200 Machine hours Setup hours 2,000 2,000 200 800 Packaging hours 50 75 The estimated overhead of $435,600 is allocated as follows: machining activity cost pool $232,320, machine set up $164,560 and packaging $38,720. (1) Determine the overhead rates using the activity-based costing approach with three cost pools. (Round answers to 2 decimal places, e.g. 15.25.) Overhead Rate Machining per hour Machine set up per hour Packaging per hour (2) Calculate the overhead allocation for the family model and the deluxe model using three activity cost pools. Overhead Allocation Family model Deluxe model $ What is the difference in allocation between two activity cost pools and three activity cost pools? Is the difference in allocation worth using the third activity cost pool? Difference $ The additional cost pool the overhead cost allocation significantly. Save for Later Attempts: 0 of 2 used Submit Answer