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 Cost Pool
|
Activity Rates
|
|
Supporting direct labor
|
$7 per direct labor-hour
|
|
Machine processing
|
$5 per machine - hour
|
|
Machine setups
|
$40 per setup
|
|
Production orders
|
$160 per order
|
|
Shipments
|
$115 per shipment
|
|
Product sustaining
|
$900 per 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
|
1,000
|
50
|
|
Machine hours
|
3,400
|
40
|
|
Machine setups
|
13
|
2
|
|
Production orders
|
13
|
2
|
|
Shipments
|
26
|
2
|
|
Product sustaining
|
2
|
2
|
Required: How much total overhead cost would be assigned to K425 and M67 using the activity-based costing system?