Conform Foam Products Produces Different Kinds of Industrial Packing Materials

question 134

Essay

Conform Foam Products produces different kinds of industrial packing materials, all in one manufacturing facility. They have identified four activities for their costing system:
Materials management-allocated by number of purchase orders
Chemical processing-allocated on metric tons
Molding-allocated on direct labor hours
Packaging-allocated by number of units produced
The activity rates are as follows:
$\begin{array}{ll}\text { Materials management } & \$ 10.00 \mathrm{Per} \text { purchase or der } \\\text { Chemical processing } & 6.50 \mathrm{Per} \text { metric ton } \\\text { Molding } & 23.50 \mathrm{Per} \text { direct labor hour } \\\text { Packaging } & 0.25 \mathrm{Per} \text { unit }\end{array}$
Engineering design shows that the order will require direct materials of $775, direct labor cost of $125, 5 purchase orders, 6 metric tons of chemical base, and 12 direct labor hours. The size of the order to produce is 5,000 units of product.
Required:
(1) Calculate the overhead cost of the order.
(2) Calculate total cost of the order.

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Definitions:

Contingent

Not necessary; could have been otherwise. What we believe (or a state of affairs) is contingent if we can imagine its being other than it is.

Royal Road

Historically, a phrase suggesting a direct and effortless path to a solution or goal; originates from the ancient Persian network of roads facilitating rapid communication.

Science

A systematic enterprise that builds and organizes knowledge in the form of testable explanations and predictions about the universe.

Sensory Evidence

Information obtained through the senses, which form the basis of empirical knowledge and understanding of the environment.