Assigning Costs to Activities

Craig Company produces electronic components for cell phone producers. The receiving department at Craig has eight clerks who process incoming goods. The total cost of their salaries is $440,000. The work distribution for the activities that they perform is as follows:

Activity Percentage of Time on Each Activity

Unloading goods 25%

Counting goods 35

Inspecting goods 40

Required:

Assign the cost of labor to each of the three activities in the receiving department.

Activity Cost Assignment

Unloading goods

Counting goods

Inspecting goods