Stelco Inc. is a privately owned company specializing in the making of specialized disposable gloves for health care industry. They company adopts a normal job order costing system., In order to ensure they have accurate costs for the product, Stelco decided to implement activity-based costing to assign manufacturing overhead to jobs. Stelco identified four activities - machining, engineering, assembling, and inspecting under activity based costing system. Under the old traditional volume-based costing system, overhead is assigned to different jobs using machine hours. Activity Machining Engineering Assembling units Inspecting products Costs $560,000 240,000 390,000 150,000 Driver Machine hours Engineering hours Assembly labour hours Inspection hours Amount of Driver 4.000 8.000 12,000 3,000 The following are the jobs Stelco worked on in October. Hospital W Dentistry X Doctor Y Med Lab Z Balance. Oct 1 $45,600 $37,200 $ 0 $ 0 October activity: Direct materials $79,400 $94,100 $43.200 $84.500 Direct labour $65.000 $53,700 $31.800 $62,300 Machine hours 30 50 100 170 Engineering hours 140 90 70 300 Assembly labour hours 200 320 280 250 Inspecting hours 80 60 10 20 On average, 80% of the Work in Process inventories on October 1 are prime costs. The actual activity costs for machining, engineering, assembling and inspecting for October were $47.400. $20,000, $32,800, and $12.500. respectively. By October 31. Job Doctor Y is the only job in progress while Jobs Hospital W and Dentistry X were completed and sold for 200 percent of prime costs. Required: 1. Determine the cost of Job Hospital w completed under the old traditional volume-based costing system and the newly implemented activity-based costing system. Briefly comment on any difference in the cost of Job Hospital W. (15 marks) 2. Using the traditional costing, determine the costs of Work In Process on October 31. (4 marks) 3. Using the traditional costing, determine the gross profits on Job Dentistry X. (10 marks) 4. Using activity-based costing, determine any under- or over-allocated overhead for the month ended October 31. Briefly comment on the causes of the under- or over-allocated overhead and how they should be accounted for. (11 marks)