Saddle Inc. has two types of handbags : standard and custom , The controller has decided to use a plant wide overhead rate based on direct labor costs . The president has heard of activity- based casting 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 $45.000 $ 1 13,000 Machine hours* 1. 140 1. 110 Setup hours 10 0 Total estimated overhead costs are $305.200. Overhead cost allocated to the machining activity cast pool is $195.0 00, and $1 13. 000 is allocated to the machine setup activity cost pool . * Your answer is incorrect Compute the overhead rate using the traditional Iplant wide ] approach . ( Round answer to 2 decimal places, 2.8. 12.25.1 Predetermined overhead rate 195 * of direct labor cost " Textbook and Media