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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 Machine-hours Machine setups Production orders Shipments Product sustaining Activity Rates $7 per direct labor-hour $4 per machine-hour Activity data have been supplied for the following two products: Total Expected Activity $ 40 per setup $ 160 per order Number of units produced per year Direct labor-hours Activity Cost Pool Supporting direct labor Machine processing Machine setups Production orders Shipments Product sustaining Total overhead cost $ 125 per shipment $ 875 per product K425 K425 M67 200 1,050 3,200 5 5 10 3 M67 2,000 Required: How much total overhead cost would be assigned to K425 and M67 using the activity-based costing system? 30 20 3 3 3

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 Machine-hours Machine setups Production orders Shipments Product sustaining Activity Rates $7 per direct labor-hour $4 per machine-hour Activity data have been supplied for the following two products: Total Expected Activity $ 40 per setup $ 160 per order Number of units produced per year Direct labor-hours Activity Cost Pool Supporting direct labor Machine processing Machine setups Production orders Shipments Product sustaining Total overhead cost $ 125 per shipment $ 875 per product K425 K425 M67 200 1,050 3,200 5 5 10 3 M67 2,000 Required: How much total overhead cost would be assigned to K425 and M67 using the activity-based costing system? 30 20 3 3 3

Financial & Managerial Accounting
Financial & Managerial Accounting
14th Edition
ISBN:9781337119207
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter18: Activity-Based Costing
Section: Chapter Questions
Problem 18.8EX: Identifying activity bases in an activity-based cost system Select Foods Inc. uses activity-based...
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Exercise 7-4 Second-Stage Allocation [LO7-4] 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 data have been supplied for the following two products: Total Expected Activity Machine-hours Machine setups Production orders. Shipments Product sustaining Number of units produced per year Direct labor-hours Activity Rates $ 7 per direct labor-hour $ 4 per machine-hour Activity Cost Pool Supporting direct labor Machine processing Machine setups Production orders $ 40 per setup $ 160 per order $ 125 per shipment $ 875 per product Shipments Product sustaining Total overhead cost K425 K425 M67 200 1,050 3,200 5 5 10 3 M67 2,000 Required: How much total overhead cost would be assigned to K425 and M67 using the activity-based costing system? 30 20 3 3 3 3
Transcribed Image Text:Exercise 7-4 Second-Stage Allocation [LO7-4] 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 data have been supplied for the following two products: Total Expected Activity Machine-hours Machine setups Production orders. Shipments Product sustaining Number of units produced per year Direct labor-hours Activity Rates $ 7 per direct labor-hour $ 4 per machine-hour Activity Cost Pool Supporting direct labor Machine processing Machine setups Production orders $ 40 per setup $ 160 per order $ 125 per shipment $ 875 per product Shipments Product sustaining Total overhead cost K425 K425 M67 200 1,050 3,200 5 5 10 3 M67 2,000 Required: How much total overhead cost would be assigned to K425 and M67 using the activity-based costing system? 30 20 3 3 3 3
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