Klumper Corporation is a diversified manufacturer of industrial goods. The compa

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: supporting direct labor Machine processing Machine setups Production orders Shipments Product sustaining 10 per direct labor-hour 45 per setup $ 160 per order $ 130 per shipment $ 775 per produet Actlivity data have been supplied for the following two products: K425 M67 Rumber ot units prodoced per year Machine setups How much tohal overtead cost would be assigned to K425 and M67 using the activity-based costing system? Machine processing C Prev 4 El Next > 3 5

Explanation / Answer

overhead assigned = activity rate *total expected activity for each individual product K425 M67 Activity cost pool Suppoerting direct labor 10000 500 Machine processing 4000 80 Machine setups 675 45 production orders 2400 160 Shipments 3900 130 product sustaining 775 775 total overhead cost 21750 1690

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