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Question 1 of 2 > View Policies - / 1 Current Attempt in Progress Saddle Inc. has two types of handbags: standard and custom.
Question 1 of 2 > View Policies - / 1 Current Attempt in Progress 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 Custom Direct labor costs $60,000 $103,000 Machine hours 1,400 1,290 Setup hours 96 400 Total estimated overhead costs are $300,000. Overhead cost allocated to the machining activity cost pool is $195,000, and $105,000 is allocated to the machine setup activity cost pool. Compute the overhead rate using the traditional (plantwide) approach. (Round answer to 2 decimal places, e.g. 12.25.) Predetermined overhead rate 184.05 % of direct labor cost eTextbook and Media Compute the overhead rates using the activity-based costing approach. (Round answers to 2 decimal places, e.g. 12.25.) Machining $ Machine setup $ per machine hour per setup hour eTextbook and Media 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 eTextbook and Media $ $ $ $ Save for Later Last saved 1 minute ago. Attempts: 0 of 5 used Submit Answer
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