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Solution: Activity Cost Pool K425 M67
Solution: Activity Cost Pool K425 M67
K425
Activity Cost Pool K425 Activity Rate Activity ABC Cost
M67
Activity Cost Pool M67 Activity Rate Activity ABC Cost
Supporting direct labor $6 per direct labor-hour 500 direct labor-hours $3000
Machine processing $4 per machine-hour 1,500 machine-hours $6000
Machine setups $50 per setup 4 setups $200
Production orders $90 per order 4 order $360
Shipments $14 per shipment 10 shipments $140
Product Sustaining $840 per product 1 product $840
Total Overhead Cost $10,540
No. of unit produced per year cost 200*1874=$3, 74,800 2000*10,540=$21, 08,000
$2,
=$2, 14,14, 54,800
54,800