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 companys operations.

		Standard		Custom
Direct labor costs		$ 41,000		$ 119,000
Machine hours		1,190		1,390
Setup hours		99		380

Total estimated overhead costs are $ 296,000. Overhead cost allocated to the machining activity cost pool is $ 199,000, and $ 97,000 is allocated to the machine setup activity cost pool.

Determine the difference in allocation between the two approaches. (Round answers to 0 decimal places, e.g. 1,225.)

Traditional costing
Standard		$ enter a dollar amount rounded to 0 decimal places
Custom		$ enter a dollar amount rounded to 0 decimal places
Activity-based costing
Standard		$ enter a dollar amount rounded to 0 decimal places
Custom