Durban Metal Products, Limited, of the Republic of South Africa makes specialty metal parts used...
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Accounting
Durban Metal Products, Limited, of the Republic of South Africa makes specialty metal parts used in applications ranging from the cutting edges of bulldozer blades to replacement parts for Land Rovers. The company uses an activity-based costing system for internal decision-making purposes. The company has four activity cost pools as listed below:
Activity Cost Pool
Activity Measure
Activity Rate
Order size
Number of direct labor-hours
$ 16.50
per direct labor-hour
Customer orders
Number of customer orders
$ 369.00
per customer order
Product testing
Number of testing hours
$ 77.00
per testing hour
Selling
Number of sales calls
$ 1,494.00
per sales call
The managing director of the company would like information concerning the cost of a recently completed order for heavy-duty trailer axles. The order required 140 direct labor-hours, 20 hours of product testing, and 6 sales calls.
Required:
What is the total overhead cost assigned to the order for heavy-duty trailer axles?
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