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 machine setup. Presented below is information related to the company's operations. Standard $41.000 Direct labor costs Machine hours Setup hours Custom $99,000 1,330 110 420 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 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 1 2 17.14 of direct labor cost LINK TO TEXT LINK TO TEXT Your answer is incorrect. Try again Compute the overhead rates using the activity-based costing approach (Round ans Machining per machine hour Machine setup per setup hour x Your answer is incorrect. Try again. Determine the difference in allocation between the two approaches. (Round answers to o decimal places, e.g. 1,225.) Traditional costing Standard Custom Activity-based costing Standard Custom Click if you would like to Show Work for this question: Open Show Work