Question
Klumper Corporation is a diversified manufacturer of industrial goods. The company's activity-based costing system contains the following six activity cost pools and activity rates: Activity
Klumper Corporation is a diversified manufacturer of industrial goods. The company's activity-based costing system contains the following six activity cost pools and activity rates:
Activity Cost Pool Activity Rates
Supporting direct labor $7.00per direct labor-hour
Machine processing $5.00per machine-hour
Machine setups $45.00per setup
Production orders $170.00per order
Shipments $120.00per shipment
Product sustaining 825.00per product
Activity data have been supplied for the following two products:
Total Expected Activity
K425 M67
Number of units produced per year 200 2,000
Direct labor-hours 1,050 40
Machine-hours 2,800 30 Machine setups 17 2
Production orders 17 2
Shipments 34 2
Product sustaining 2 2
Required:
Determine the total overhead cost that would be assigned to each of the products listed above in the activity-based costing system.
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