Calculating overhead costs

The manufacturing company prepares the following budget for 2020. Machining Finishing Factory overhead ' $ 96,000 $ 200,000 Machine hours ' 6000 840 Direct labour cost ' $ 60,000 $ 400,000 This company uses a predetermined overhead rate for applying overhead based on machine hours for 'machining' and direct labour cost for 'nishing'. You are given the following actual information about one job: Machining Finishing Direct materials used $ 11,000 $ 3,000 Machine hours 300 40 Direct labour cost $ 10,000 $ 20,000 Required: (1) Compute the total cost (full cost) for this job. (10 marks) (2) Why we need to develop Activity-based costing (ABC)