Smithson, Inc. decided to implement the activity-based costing approach and was quite successful in its use. However, the controller is wondering if instead of only two activity cost pools, they should expand to three activity cost pools based on the following: Family Model Deluxe Model Direct labor costs $75,000 Machine hours $2,00 Setup hours Packaging hours S50 S150,000 $2,00 $800 $75 $200 The estimated overhead of S450,000 is allocated as follows: machining activity cost pool $240,000, machine set up S170,000 and packaging S40,000 Instructions a) Determine the overhead rates using the activity-based costing approach with three cost pools b) Determine the overhead allocation for the family model and the deluxe model using three activity cost pools. What is the difference in allocation between two activity cost pools and three activity cost pools? Is the difference in allocation worth using the third activity cost pool