Lab Topic Chapter 4 Piedmont Computer Company uses a job order costing system in which cach batch manufactured is a different job. Piedmont Computer Company assigns direct materials and direct labor to each job. The company assigns labor costs at $25 per hour. It allocates manufacturing overhead to jobs based on a predetermined overhead allocation rate, computed as a percentage of direct labor costs. At the beginning of 2020, the controller prepared the following budget: Manufacturing overhead $ 290,000 Direct labor costs $ 1,160,000 The controller also noted that three cost pools make up the manufacturing overhead: Budgeted Estimated Cost Manufacturing Driver Activity Cost Pool Overhead Cost Driver for the Year Assembly $235,000 Number of parts 940,000 Programming $35,000 Number of direct labor hours 10,000 Testing $20,000 Number of tests 160 In November 2020, Piedmont Computer Company worked on several jobs. Records for two jobs appear here: Job 721 Job 722 Direct labor hours 780 hours 60 hours Direct materials $ 23,400 $ 2,500 Total number of parts 2,500 300 Total number of tests 8 2 Requirements: Be sure to show all work to arrive at the answers below and include text labels for items in your calculations so it is clear what you did. 1. Compute Piedmont Computer Company's total cost of Job 721 using the traditional plantwide manufacturing overhead rate based on a percentage of direct labor cost. 2. Compute the total cost of Job 721 using activity-based costing. 3. Why does the job cost differ between a traditional plantwide allocation vs. activity-based costing