please be as clear and as simple as possible. I am trying to understand it. show me the steps, not only the answers. thank you in advance.

E21-16, Compute overhead rates and assign overhead using ABC. Major Instrument, Inc. manufactures two products: missile range instruments and space pressure gauges. During April, 50 range instruments and 300 pressure gauges were produced, and overhead costs of $94,500 were estimated. An analysis of estimated overhead costs reveals the following activities. Cost Drivers Total Cost Activities $40,000 Materials handling No. of requisitions Machine setups No. of setups 27,500 3 Quality inspections No. of inspections 27,000 $94,500 The cost driver volume for each product was as follows. Cost Drivers No. of requisitions No. of setups Total Instruments Gauges 400 600 1,000 200 300 500 No. of inspections 200 400 600 Instructions: (a) Determine the overhead rate for each activity. (b) Assign the manufacturing overhead costs for April to the two products using activity-based costing (ABC). (c) Write a memorandum to the president of Major Instrument explaining the benefits of ABC. NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?" Activity (a) Expected Use Based Estimated of Cost Drivers Overhead Activity Cost Pools Materials handling per Activity Overhead Rates Value Value Value Machine setups Value Quality inspections Value Value Instruments Total Cost (b) Gauges Cost Assigned Cost Driver Number Cost Number Value Value Value Requisitions Machine setups Value ? ? Value ? Value ? Inspections Total costs assigned Units produced Overhead Cost per Unit ? Value Value P21-7A, Assign overhead to products using ABC Schultz Electronics manufactures two large-screen television models: the Royale which sells for $1,600, and a new model, the Majestic, which sells for $1,300. The production cost computed per unit under traditional costing for each model in 2014 was as follows. Traditional Costings Royale $ Majestic Direct materials 700 420 Direct labor ($20 per hour) 120 100 Manufacturing overhead ($38 per DLH) 228 190 1,048 710 In 2014, Schultz manufactured 25,000 units of the Royale and 10,000 units of the Majestic. The overhead rate of $38 per direct labor hour was determined by dividing the total expected manufacturing overhead of $7,600,000 by the total direct labor hour (200,000) for the two models. Under traditional costing, the gross profit on the models was Royale $552 or ($1,600-$1,048), and Majestic $590 or ($1,300-$710). Because of this difference, management is considering phasing out the Royale model and increasing the production of the Majestic model. Before finalizing its decision, management asks Schultz's controller to prepare an analysis using activity-based costing (ABC). The controller accumulates the following information about overhead for the year ended December 31, 2014. Expected use of Activity Estimated Based Cost Drivers Overhead 1,200,000 Cost Drivers Overhead Rate Activities Purchasing No. of orders $30/order 40,000 $50/setup Machine setups No. of setups 900,000 18,000 Machining Quality control Machine hours 4,800,000 $40/hour 120,000 No. of inspections 28,000 $25/inspection 700,000 The cost drivers for each product were: Cost Drivers Purchase orders Royale 17,000 Majestic Total 23,000 40,000 Machine setups 13,000 18,000 5,000 Machine hours 75,000 45,000 120,000 11,000 Inspections 17,000 28,000 Instructions (a) Assign the total 2014 manufacturing overhead costs to the two products using activity-based costing (ABC) and determine the overhead cost per unit. (b) What was the cost per unit and gross profit of each model using ABC costing? (c) Are management's future plans for the two models sound? Explain. NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?" Total Cost (a) Royale Majestic Drivers used Assigned Cost Driver Drivers used Cost Cost Value Purchase orders Value Machine setups Value Value Machine hours Value Value Inspections Total costs assigned Units produced Value Value Value Value Overhead Cost per Unit Maiestic (b) Rovale Direct materials Value Value Value Direct labor Value Manufacturing overhead Total Cost per unit Value Sales price per unit Value Cost per unit Gross profit per unit