Exercise 17-1 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 machinc sctup. Prescnted below is information related to the company's operations Standard Custom Direct labor costs Machine hours Setup hours $40,000 1,150 103 $110,000 1,160 370 Total estimated overhead costs are $295,000. Overhead cost allocated to the machining activity cost pool is S196,000, and $99,000 is allocated to the machine setup activity cost pool. Your answer is incorrect. Try again. Compute the overhead rate usingthe traditional (plantwide) approach. (Round answer to 2 decimal places, e.g. 12.25.) Predetenmined overhead rate 196 of direct labor cost