Doreen Design Inc. manufactures custom-made furniture. Doreen currently uses a single overhead rate (traditional method) based on machine hours to allocate manufacturing overhead (MOH) to individual jobs. It estimates to incur 3,000 machine hours this year and expects manufacturing overhead to be $96,000. However, the owner and CEO is considering using activity-based costing to allocate manufacturing overhead. She has identified four activities that incur or drive manufacturing overhead costs: purchase orders, parts administration, machine-set ups and machining. The budgeted activity costs for the upcoming year and the allocation bases are as follows: Activity Allocation base Budgeted manufacturing overhead costs Estimated volume of allocation base Purchase orders $5,600 # purchase orders 100 purchase orders Parts administration $6,400 # parts 3,200 parts # set ups Machine set-ups $39,000 20 set ups Machining $45,000 # machine hours 3,000 machine hours Job 420 used 5 purchase orders, 250 parts, 3 set-ups and 130 machine hours Job 510 used 10 purchase orders, 400 parts, 8 set-ups and 200 machine hours Required: 1. Using the traditional method of cost allocation determine the manufacturing overhead that will be allocated to Job 420 and Job 510. (6 marks) 2. Using activity based costing compute the activity rate for each activity. (4 marks) 3. Using activity based costing compute the manufacturing overhead costs that will be allocated to Job 420. (4 marks) 4. Using activity based costing compute the manufacturing overhead costs that will be allocated to Job 510. (4 marks) ENTER YOUR ANSWER IN THE WHITE SPACE BELOW SHOW ALL YOUR CALCULATIONS IN ORDER TO RECEIVE PART MARKS