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 Supporting direct labor Machine processing Machine setups Production orders Shipments Product sustaining Activity Rates $ 8 per direct labor-hour $ 2 per machine-hour $ 45 per setup $ 160 per order $ 115 per shipment $ 900 per product Activity data have been supplied for the following two products: Total Expected Activity K425 M67 200 2,000 1,150 40 3,200 7 Number of units produced per year Direct labor-hours Machine-hours Machine setups Production orders Shipments Product sustaining 30 7 14 Required: How much total overhead cost would be assigned to K425 and M67 using the activity-based costing system?

Answer 1

	K425	M67
Supporting labor	9200	320
Machine processing	6400	60
Machine setups	315	90
Production orders	1120	320
Shipments	1610	230
Product sustaining	1800	1800
Total	20445	2820