Exercise 17-01 Saddle Inc. has two types of handbags: standard and custom. The controller has decided to use a plantwide overhead rate based on direct labor costs. The president has heard of activity-based costing and wants to see how the results would differ if this system were used. Two activity cost pools were developed: machining and machine setup. Presented below is information related to the company's operations. Direct labor costs Machine hours Setup hours Standard $50,000 1,200 Custom $100,000 1,200 120 420 Total estimated overhead costs are $305,400. Overhead cost allocated to the machining activity cost pool is $192,000, and $113,400 is allocated to the machine setup activity cost pool. wdy Compute the overhead rate using the traditional (plantwide) approach. (Round answer to 2 decimal places, 6.9. 12.25.) Predetermined overhead rate % of direct labor cost LINK TO VIDEO LINK TO TEXT Compute the overhead rates using the activity-based costing approach per machine hour Machining per setup hour Machine setup $ Return to Blackboard Kimmel, Accounting, 7e Help System Announcements Compute the overhead rates using the activity-based costing approach. CALCULATOR Machining per machine hour Machine setup $ per setup hour LINK TO TEXT TO VIDEO Determine the difference in allocation between the two approaches. udy. Traditional costing Standard Custom Activity-based costing Standard Custom LINK TO TEXT LINK TO VIDEO Question Attempts: 2 of 15 used SAVE FOR LATER SU Exercise 17-01 Saddle Inc. has two types of handbags: standard and custom. The controller has decided to use a plantwide overhead rate based on direct labor costs. The president has heard of activity-based costing and wants to see how the results would differ if this system were used. Two activity cost pools were developed: machining and machine setup. Presented below is information related to the company's operations. Direct labor costs Machine hours Setup hours Standard $50,000 1,200 Custom $100,000 1,200 120 420 Total estimated overhead costs are $305,400. Overhead cost allocated to the machining activity cost pool is $192,000, and $113,400 is allocated to the machine setup activity cost pool. wdy Compute the overhead rate using the traditional (plantwide) approach. (Round answer to 2 decimal places, 6.9. 12.25.) Predetermined overhead rate % of direct labor cost LINK TO VIDEO LINK TO TEXT Compute the overhead rates using the activity-based costing approach per machine hour Machining per setup hour Machine setup $ Return to Blackboard Kimmel, Accounting, 7e Help System Announcements Compute the overhead rates using the activity-based costing approach. CALCULATOR Machining per machine hour Machine setup $ per setup hour LINK TO TEXT TO VIDEO Determine the difference in allocation between the two approaches. udy. Traditional costing Standard Custom Activity-based costing Standard Custom LINK TO TEXT LINK TO VIDEO Question Attempts: 2 of 15 used SAVE FOR LATER SU