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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
13
2
26
Required: How much total overhead cost would be assigned to K425 and M67 using the activity-based costing system?
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