Question 1 Eric Parker has been studying his department's profitability reports for the past six months. He has just completed a managerial accounting course and is beginning to question the company's approach to allocating overhead to products based on machine hours. The current department overhead budget of $930,230 is based on 44,500 machine hours. In an initial analysis of overhead costs, Eric has identified the following activity cost pools Cost Pool Expected Cost Expected Activities Product assembly 400,500 328,950 125,580 75,200 $930,230 44,500 Machine hours Machine setup and calibration Product inspection Raw materials storage 2,550 setups 1,380 batches 470,000 pounds (a) Calculate the company's overhead rate based on machine hours. (Round answer to 2 decimal places, e.g. 15.25.) Overhead rate / MH (b) Calculate the company's overhead rates using the proposed activity-based costing pools. (Round answers to 2 decimal places, e.g. 15.25.) Product assembly Machine setup and calibration Product inspection Raw materials storage MH / setup /batch