(TIMING - question should take you 12 - 15 minutes which practicing, 9 - 11 minutes just before an exam) Watson Inc. has two types of shoes: standard and custom. The controller has decided to use a plant-wide overhead rate based on direct labour 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 machine set-up. Presented below is information related to the company's operations, Standard Custom Direct labour costs $50,000 $100,000 Machine hours 500 1500 Machine set ups 100 400 Total estimated overhead costs are $450,000. The overhead cost allocated to the machining activity cost pool is $349,500 and $100,500 is allocated to machine set-up activity cost pool. Please answering the following questions: (a) Calculate the overhead rate using the traditional approach. % of direct labour cost. (b) Calculate the overhead rates using the activity-based costing approach. Machining: S per machine hour Machine setup: S per setup hour. (c) Calculate the allocation of overhead to the standard shoes under both approaches: Traditional: $ Activity-Based: S (d) Calculate the allocation of overhead to the custom shoes under both approaches: Traditional: $ Activity-Based: $ (c) Calculate the total overhead allocated to: Machining: S Set ups: 8 (f) Calculate the total overhead allocated under: Traditional: $ Activity-Based: $