Send to Gradebook Question 1 2.35/3.5 View Policies Show Attempt History 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. Direct labor costs Machine hours Standard Custom $50,000 $100,000 1,2001,200 90 390 Setup hours Total estimated overhead costs are $292,800. Overhead cost allocated to the machining activity cost pool is $192,000, and $100,800 is allocated to the machine setup activity cost pool. Compute the overhead rates using the activity-based costing approach. Machining 80 per machine hour Machine setup $ 210 per setup hour eTextbook and Media Attempts: 1 of 2 used Determine the difference in allocation between the two approaches. Traditional costing Standard Custom Activity-based costing Standard Custom