Chapter 7 Activity-Based Costing and Management Exercise 7-10 Activity Rates Johansson Company uses ABC. Johansson manufactures outdoor water toys using two activities: plastic injection moulding and decal application. Johansson's 2018 total budgeted overhead costs for these two activities are $500,000 (70 percent for injection moulding and 30 percent for decal application). Moulding overhead costs are driven by the number of kilograms of plastic that are moulded together. Decal application overhead costs are driven by the number of decals applied to toys. The budgeted activity data for 2018 are as follows: Kilograms of plastic moulded 3,500,000 375,000 OBJECTIVE Required: Number of decals applied 1. Calculate the activity rate for the plastic injection moulding activity. 2. Calculate the activity rate for the decal application activity