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Swifty, Inc. produces two types of gas grills: a family model and a deluxe model. Swifty's controller has decided to use a plantwide overhead rate

Swifty, Inc. produces two types of gas grills: a family model and a deluxe model. Swifty's controller has decided to use a plantwide overhead rate based on direct labor costs. The president of the company recently 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:
\table[[,Family Model,Deluxe Model],[Direct labor costs,$75,600,$151,200
A)
Compute the overgead rate using the traditonal (plantwide) approach?
B)
Compute the overhead rates using activity-based costing approach?
C)
Determine the difference in allocation between the two approaches?
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