Exercise 17-1 (Part Level Submission) 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 past pools were developed: machining and machine setup. Presented below is information related to the company's operations. Standard Direct labor costs Machine hours Setup hours $58,000 1,190 Custom $97,000 1,220 109 400 Total estimated overhead costs are $304,000. Overhead cost allocated to the machining activity cost pool is $197,000, and $107,000 is allocated to the machine setup activity cost pool. (a) Your answer is correct. Compute the overhead rate using the traditional (plantwide) approach. (Round answer to 2 decimal places, e.g. 12.25.) Predetermined overhead rate 196.13% of direct labor cost Click if you would like to Show Work for this question: Open Show Work SHOW SOLUTION SHOW ANSWER LINK TO TEXT LINK TO TEXT VIDEO: SIMILAR EXERCISE Attempts: 1 of 3 used (b) Compute the overhead rates using the activity based casting approach. (Round answers to 2 decimal places, e.g. 12.25.) Machining per machine hour Machine setups per setup hour Click if you would like to Show Work for this question: Open Show Work