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Transvaal Mining Tools Ltd. of South Africa makes specialty tools used in the mining industry. The company uses an activity-based costing system for internal decision-making

Transvaal Mining Tools Ltd. of South Africa makes specialty tools used in the mining industry. 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 R 17.60 per direct labor-hour*
Customer orders Number of customer orders R 360 per customer order
Product testing Number of testing hours R 79 per testing hour
Selling Number of sales calls R 1,494 per sales call

* (The currency in South Africa is the rand, denoted here by R.)

The managing director of the company would like information concerning the cost of a recently completed order for hard-rock drills. The order required 150 direct labor-hours, 18 hours of product testing, and three sales calls.

Required:

a.

Prepare a report summarizing the overhead costs assigned to the order for hard-rock drills. (Omit the "R" sign in your response.)

Activity Cost Pool ABC Cost
Order size R
Customer orders
Product testing
Selling

Total R



b.

What is the total overhead cost assigned to the order? (Omit the "R" sign in your response.)

Total overhead cost R

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