The job costing system at Sheris Custom Framing has five indirect-cost pools (purchasing, material handling, machine maintenance, product inspection, and packaging). The company is in the process of bidding on two jobs: Job 215, an order of 15 intricate personalized frames, and Job 325, an order of 6 standard personalized frames. The controller wants you to compare overhead allocated under the current simple job-costing system and a newly designed activity-based job-costing system. Total budgeted costs in each indirect-cost pool and the budgeted quantity of activity driver are as follows:

	Budgeted Overhead	Activity Driver	Budgeted Quantity of Activity Driver
Purchasing	$ 35,000	Purchase orders processed	2,000
Material handling	43,750	Material moves	5,000
Machine maintenance	118,650	Machine-hours	10,500
Product inspection	9,450	Inspections	1,200
Packaging	19,950	Units produced	3,800
	$226,800

Information related to Job 215 and Job 325 follows. Job 215 incurs more batch-level costs because it uses more types of materials that need to be purchased, moved, and inspected relative to Job 325.

	Job 215	Job 325
Number of purchase orders	25	8
Number of material moves	10	4
Machine-hours	40	60
Number of inspections	9	3
Units produced	15	6

1. Compute the total overhead allocated to each job under a simple costing system, where overhead is allocated based on machine-hours (1 point).
2. Compute the total overhead allocated to each job under an activity-based costing system using the appropriate activity drivers (2 points).
3. Explain why Sheris Custom Framing might favor the ABC job-costing system over the simple job-costing system, especially in its bidding process (2 points).