SecuriCorp operates a fleet of armored cars that make scheduledpickups and deliveries in the Los Angeles area. The company isimplementing an activity-based costing system that has fouractivity cost pools: Travel, Pickup and Delivery, Customer Service,and Other. The activity measures are miles for the Travel costpool, number of pickups and deliveries for the Pickup and Deliverycost pool, and number of customers for the Customer Service costpool. The Other cost pool has no activity measure because it is anorganization-sustaining activity. The following costs will beassigned using the activity-based costing system:

Driver and guard wages	$	720,000
Vehicle operating expense		280,000
Vehicle depreciation		120,000
Customer representative salariesand expenses		160,000
Office expenses		30,000
Administrative expenses		320,000
Total cost	$	1,630,000

The distribution of resource consumption across the activitycost pools is as follows:

	Travel		Pickup and Delivery		Customer Service		Other		Totals
Driver and guard wages	50	%	35	%	10	%	5	%	100	%
Vehicle operating expense	70	%	5	%	0	%	25	%	100	%
Vehicle depreciation	60	%	15	%	0	%	25	%	100	%
Customer representative salariesand expenses	0	%	0	%	90	%	10	%	100	%
Office expenses	0	%	20	%	30	%	50	%	100	%
Administrative expenses	0	%	5	%	60	%	35	%	100	%

Required:

Complete the first stage allocations of costs to activity costpools.

2.

Green Thumb Gardening is a small gardening service that usesactivity-based costing to estimate costs for pricing and otherpurposes. The proprietor of the company believes that costs aredriven primarily by the size of customer lawns, the size ofcustomer garden beds, the distance to travel to customers, and thenumber of customers. In addition, the costs of maintaining gardenbeds depends on whether the beds are low maintenance beds (mainlyordinary trees and shrubs) or high maintenance beds (mainly flowersand exotic plants). Accordingly, the company uses the five activitycost pools listed below:

Activity Cost Pool	ActivityMeasure
Caring for lawn	Square feet of lawn
Caring for garden beds–lowmaintenance	Square feet of low maintenancebeds
Caring for garden beds–highmaintenance	Square feet of high maintenancebeds
Travel to jobs	Miles
Customer billing andservice	Number of customers

The company already has completed its first stage allocations ofcosts and has summarized its annual costs and activity asfollows:

Activity Cost Pool	Estimated Overhead Cost		Expected Activity
Caring for lawn	$	72,000	150,000	square feet of lawn
Caring for garden beds–lowmaintenance	$	26,400	20,000	square feet of low maintenancebeds
Caring for garden beds–highmaintenance	$	41,400	15,000	square feet of high maintenancebeds
Travel to jobs	$	3,250	12,500	miles
Customer billing andservice	$	8,750	25	customers

Required:

Compute the activity rate for each of the activity cost pools.(Round your answers to 2 decimal places except customerbilling and service.)

3.

Klumper Corporation is a diversified manufacturer of industrialgoods. The company’s activity-based costing system contains thefollowing six activity cost pools and activity rates:

Activity Cost Pool	Activity Rates
Supporting direct labor	$	6	per direct labor-hour
Machine processing	$	4	per machine-hour
Machine setups	$	50	per setup
Production orders	$	90	per order
Shipments	$	14	per shipment
Product sustaining	$	840	per product

Activity data have been supplied for the following twoproducts:

	Total Expected Activity
	K425	M67
Number of units produced peryear	200	2,000
Direct labor-hours	80	500
Machine-hours	100	1,500
Machine setups	1	4
Production orders	1	4
Shipments	1	10
Product sustaining	1	1

Required:

How much total overhead cost would be assigned to K425 and M67using the activity-based costing system?