5. Kulka Corporation manufactures two products: Product F82D and Product TOSP. The company uses a...
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5. Kulka Corporation manufactures two products: Product F82D and Product TOSP. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products F82D and TOSP. Activity Cost Pool Activity Measure Total Cost Total Activity Machining Machine-hours $180,000 9,000 MHs Machine setups Number of setups $125,000 250 set-ups Product design Number of products $125,000 2 products General factory Direct labor-hours $260,000 10,000 DLHS Activity Measure Product F82D Product TOSP Machine-hours 5,000 4,000 Number of setups 160 Number of products 1 Direct labor-hours 4,000 6,000 Using the ABC system, how much total manufacturing overhead cost would be assigned to Product TOSP? 90
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