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Exercise 7 - 9 ( Algo ) Second - Stage Allocation to an Order [ LO 7 - 4 ] Durban Metal Products, Limited, of
Exercise Algo SecondStage Allocation to an Order LO
Durban Metal Products, Limited, 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 activitybased costing system for
internal decisionmaking purposes. The company has four activity cost pools as listed below:
The managing director of the company would like information concerning the cost of a recently completed order for heavyduty trailer
axles. The order required direct laborhours, hours of product testing, and sales calls.
Required:
What is the total overhead cost assigned to the order for heavyduty trailer axles?
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