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:

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:
Prepare a report showing the overhead cost of the order for hard-rock drills according to the activity based costing system. What is the total overhead cost assigned to theorder?

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Activity Cost Pool Activity Measure Activity Rate Order size. Customer orders Number of direct labor-hours R17.60 per direct labor-hour Number of customer orders .... Number of testing hours R360 per customer order R79 per testing hour Product testing Selling.... Number of sales calls R1.494 per sales call (The currency in South Africa is the rand, denoted here by R)