Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Durban Metal Products, Ltd., of the Republic of South Africa makes specialty metal parts used in applications ranging from the cutting edges of bulldozer blades

Durban Metal Products, Ltd., of the Republic of South Africa makes specialty metal parts used in applications ranging from the cutting edges of bulldozer blades to replacement parts for Land Rovers. The company uses an activity-based costing system for internal decision-making purposes. The company has four activity cost pools as listed below:

Activity Cost Pool Activity Measure Activity Rate
Order size Number of direct labor-hours $ 16.10 per direct labor-hour
Customer orders Number of customer orders $ 353.00 per customer order
Product testing Number of testing hours $ 76.00 per testing hour
Selling Number of sales calls $ 1,482.00 per sales call

The managing director of the company would like information concerning the cost of a recently completed order for heavy-duty trailer axles. The order required 170 direct labor-hours, 11 hours of product testing, and 3 sales calls.

Required:

What is the total overhead cost assigned to the order for heavy-duty trailer axles?

Activity Cost Pool ABC Cost
Order size
Customer orders
Product testing
Selling
Total overhead cost

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial And Managerial Accounting

Authors: John J Wild

6th Edition

1259621758, 978-1259621758

More Books

Students also viewed these Accounting questions

Question

BPR always involves automation. Group of answer choices True False

Answered: 1 week ago

Question

9. Describe the characteristics of power.

Answered: 1 week ago

Question

10. Describe the relationship between communication and power.

Answered: 1 week ago