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  3. swifty inc. has two types of handbags: standard an

Swifty Inc. has two types of handbags: standard and custom. The controller has decided to...

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Accounting

Swifty Inc. has two types of handbags: standard and custom. The controller has decided to use a plantwide overhead rate based on
direct labor 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 hours) and machine setup (number of setups). The total estimated
machine hours is 2,400, and the total estimated number of setups is 500. Presented below is information related to the company's
operations.
Total estimated overhead costs are $297,000. Overhead cost allocated to the maching activity $192,000, and $1000
is allocated to the machine setup activity cost pool.
(a)
Compute the overhead rate using the traditional (plantwide) approach information related to each product's use of cost drivers.
(Round answer to 0 decimal places, e.g.12.)
Predetermined overhead rate
% of direct labor cost
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