URGENT Proxi Analytics Ltd manufactures two types of sensors Proximity and Reflex. During 2021, 150 Proximity and 100 Reflex sensors were manufactured. Indirect production costs incurred were $150,000. Indirect costs and activities were the following: Activity Cost Driver Amount ($) Trimming Number of machine hours $75,000 Final Assembly Number of components $45,000 Pre-shipment inspection Number of inspections $30,000 TOTAL $150,000 The cost driver volumes for each sensor were the following: Cost Driver Proximity Reflex Number of machine hours 4,500 3,000 Number of components 700 800 Number of inspections 1,500 1,000

4c) If manufacturing overhead is allocated on the basis of only machine hours for the year, calculate the predetermined manufacturing overhead rate. Show all calculations.

4d) Allocate the indirect manufacturing overhead costs to the sensors using the traditional method. Show all calculations.

4e)Distinguish between activity based costing and traditional costing. Discuss why it is more appropriate for Proxi Analytics Ltd to use ABC.