Question

Klumper Corporation is a diversified manufacturer of industrial goods. The company's activity-based costing system contains th 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 $ 7 per direct labor-hour $ 3 per machine-hour $ 40 per setup 5 150 per order $ 115 per shipment $ 750 per product Activity data have been supplied for the following two products: Total Expected Activity K425 67 200 2.000 1,050 3,000 Number of units produced per year Direct labor-hours Machine-hours Machine setups Production orders Shipments Product sustaining

Answer 1

Activity Cost Pool K425				Total
Direct labor-hours	925	Cost per direct labor-hour	7	Supporting direct labor	6475
Machine-hours	2,400	Cost per machine-hour	3	Machine processing	7200
Machine setups	21	Cost per setup	45	Machine setups	945
Production orders	21	Cost per order	160	Production orders	3360
Shipments	42	Cost per shipment	130	Shipments	5460
Product sustaining	3	Cost per product	825	Product sustaining	2475
Total overhead cost					25915
Activity Cost Pool M67
Direct labor-hours	50	Cost per direct labor-hour	7	Supporting direct labor	350
Machine-hours	40	Cost per machine-hour	3	Machine processing	120
Machine setups	3	Cost per setup	45	Machine setups	135
Production orders	3	Cost per order	160	Production orders	480
Shipments	3	Cost per shipment	130	Shipments	390
Product sustaining	3	Cost per product	825	Product sustaining	2475
Total overhead cost					3950