Plum Tired manufactures tires for dune buggies and has two different products:  

Nubby Tires: 5,000 produced; 400 requisitions, 200 setups, 200 inspections

Smooth Tires: 10,000 produced; 600 requisitions, 300 setups, 400 inspections

The following information is available:

Total overhead costs of $171,000 are broken out as follows:

Materials Handling - $60,000 - Cost driver is number of requisitions

Machine setups - $54,000 - Cost driver is number of setups

Inspections - $57,000 - Cost driver is number of inspections

Estimated Direct Labor hours used: 1,900

1. Using TRADITIONAL costing, and assuming overhead is applied based on direct labor hours, compute the predetermined overhead rate. (i.e. $25.00)

2. Using Activity Based Costing, how much of the $171,000 in factory overhead would be applied to the nubby tires? (i.e. $25,000)

3. Using Activity Based Costing, how much of the $171,00 in factory overhead would be applied to the smooth tires? (i.e. $25,000)