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 $ 11 per direct labor-hour Machine processing $ 3 per machine-hour Machine setups $ 40 per setup Production orders $ 160 per order Shipments $ 125 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 1,150 50 Machine-hours 2,400 40 Machine setups 11 3 Production orders 11 3 Shipments 22 3 Product sustaining 3 3 Required: How much total overhead cost would be assigned to K425 and M67 using the activity-based costing system?

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 $ 11 per direct labor-hour Machine processing $ 3 per machine-hour Machine setups $ 40 per setup Production orders $ 160 per order Shipments $ 125 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 1,150 50 Machine-hours 2,400 40 Machine setups 11 3 Production orders 11 3 Shipments 22 3 Product sustaining 3 3 Required: How much total overhead cost would be assigned to K425 and M67 using the activity-based costing system?

Name: Exercise 7-4 (Algo) Second-Stage Allocation [LO7-4]Klumper Corporation
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Description: Exercise 7-4 (Algo) 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 Poo

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 3ADM: Production run size and activity improvement Littlejohn, Inc. manufactures machined parts for the...

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Exercise 7-4 (Algo) 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	Activity Rates
Supporting direct labor	$ 11	per direct labor-hour
Machine processing	$ 3	per machine-hour
Machine setups	$ 40	per setup
Production orders	$ 160	per order
Shipments	$ 125	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	1,150	50
Machine-hours	2,400	40
Machine setups	11	3
Production orders	11	3
Shipments	22	3
Product sustaining	3	3

Required:

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

Exercise 7-4 (Algo) 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
Activity Rates
$ 11 per direct labor-hour
$ 3 per machine-hour
$ 40 per setup
$ 160 per order
$ 125 per shipment
$ 900 per product
Production orders
Shipments
Product sustaining
Activity data have been supplied for the following two products:
Total Expected Activity
K425
М67
Number of units produced per year
200
2,000
Direct labor-hours
1,150
2,400
50
Machine-hours
40
Machine setups
11
3
Production orders
11
3
Shipments
Product sustaining
22
3
3
Required:
How much total overhead cost would be assigned to K425 and M67 using the activity-based costing system?
Activity Cost Pool
K425
M67
Supporting direct labor
Machine processing
Machine setups
Production orders
Shipments
Product sustaining
Total overhead cost
$
0 $

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