Question

Klumper Corporation is a diversified manufacturer of industrial goods. The company's activity-based costing wystem contains the following si activity cost pools and activity rates Activity Cost Pool Supporting direct labor Machine processing Machine setups Production orders Shipments Product Sustaining Activity Rains 8.00 per direct labor-hour 500 per machine-hour $ 450 per setup $ 15000 per order 120.00 per shipment 80000 per product Activity data have been supplied for the following two products: To Expected Activity 1.175 Number of units produced per year Direct labor hours Machine-hours Machine setups Production orders 2.400 Product sustaining Required: Determine the total overhead cost that would be assigned to each of the products listed above in the activity-based costing system K425 MET Activity Cost Pool Supporting direct labor Machine processing Machine setups Production orders Product sustaining Total Overhead cost

Answer 1

Determine total overhead cost

	K425	M67
Supporting direct labor	1175*8 = 9400	240
Machine processing	2400*5 = 12000	100
Machine setup	19*45 = 855	135
Production orders	19*150 = 2850	450
Shipments	38*120 = 4560	360
Product sustaining	2400	2400
Total overhead cost	32065	3685