E4-3B Domestic Fabrics has budgeted overhead costs of $955,000. It has allocated over- head on a plantwide basis to its two products (wool and cotton) using direct labor hours traditiona which are estimated to be 477,500 for the current year. The company h experiment with activity-based costing and has created two activity cost pools a related activity cost drivers. These two cost pools are hours) and Design (cost driver is number of setups). Overhead allocated to the Cutting cost pool is $400,000 and $555,000 is allocated to the Design cost pool. Additional infor- mation related to these pools is as follows. as decided to (So 1, 4) nd Cutting (cost driver is machine Wool Cotton Total 100,000 100,000 Machine hours Number of setups Instructions (a) Determine the amount of overhead allocated to the wool product line and the cotton product line using activity-based costing (b) What is the difference between the allocation of overhead to the wool and cotton product lines using activity-based costing versus the traditional approach, assuming direct labor hours were incurred evenly between the wool and cotton