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 activitybased costing system for internal decisionmaking purposes. The company has four activity cost pools as listed below:
tableActivity Cost Pool,Activity Measure,Activity RateOrder size,Number of direct laborhours,$ per direct laborhourCustomer orders,Number of customer orders,$ per customer orderProduct testing,Number of testing hours,$ per testing hourSellingNumber of sales calls,$ per sales call
The managing director of the company would like information concerning the cost of a recently completed order for heavyduty trailer axles. The order required direct laborhours, hours of product testing, and sales calls.
Required:
What is the total overhead cost assigned to the order for heavyduty trailer axles?
tableActivity Cost Pool,ABC CostOrder size,Customer orders,Product testing,SellingTotal overhead cost,$
