Allocating Selling and Adminlstrative Expenses using Activlty-Based Costing Shrute Inc. manufactures oftice copiers, which are sold to retailers. The price and cost ot goods sold for each copier are as follows: Price Cost of goods sold Gross profit In addition, the company incurs selling and administrative expenses of $271,440. The company wishes to assign these costs to its three major retail customers, The Warehouse, Kosmo Co., and Supply Unlverse. These expenses are related to Its three major nonmanufacturing actlvitles: customer service, sales order processing, and advertising support. The advertising support is In the form of advertisements that are placed by Shrute Inc. to support the retailer's sale of Shrute copiers to consumers. The budgeted activity costs and activity bases associated with these activities are Activity Customer service Sales order processing Advertising support $690 per unit 110 $280 per unit Budgcted Activity Cost Activity Basc $37,180 25,760 208,500 $271,440 Number of service requests Number of sales orders Number of ads placed lotal activity cost Activity base usage and unit volume intormation for the three customers is as follows The Warehouse 50 260 20 670 Kosmo Co. Supply Universe Number of service requests Number of sales orders Number of ads placed Unit volume 10 110 20 670 200 550 110 670 Total 260 920 150 2,010