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

Durban Metal Products, Ltd., of the Republic of South Africa specialty 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 PoolActivity Measure Activity Rate

Order Size................Number of Direct labor-hours $16.85 per direct labor hour

Customer orders..... Number of customer orders $320.00 per customer order

Product testing......... Number of testing hours $89.00 per testing hour

Selling........................... Number of sales calls $1,090.00 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 200 direct labor-hours, 4 hours of product testing and 2 sales calls.

Required:

Prepare a report summarizing the overhead costs assigned to the order for heavy-duty trailer axles. What is the total overhead cost assigned to the order?

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