Direct labor hours Machine hours Number of parts Regular 10,000 10,000 90,000 Supreme 15,000 30,000 160,000 Addison Company manufactures two products, Regular and Supreme. Addison's overhead costs consist of machining, $2,500,000; and assembling, $1,250,000. Machining is allocated based on machine hours. Assembly is allocated based on number of parts. Information on the two products is: In the past, Addison allocated overhead using a plantwide rate based on labor hours. Addison has now switched to activity-based costing. Overhead applied to Regular using activity-based costing is $1,075,000. $1,500,000. $2,250,000. $2,675,000