Escau Company is a wholesale distributor that uses activity-based costing for all of its overhead costs. The company has provided the following data concerning its annual overhead costs and its activity-based costing system:

Overhead costs:
Wages and salaries	$380,000
Other expenses	100,000
Total	$480,000

Distribution of Resource Consumption:

	Activity Cost Pools
	Filling Orders	Customer Support		Total
Wages and salaries	30%	70%		100%
Other expenses	35%	65%		100%

The activity measures for the activity cost pools for the year are as follows:

Activity Cost Pool	Activity
Filling orders	3,000 orders
Customer support	20 customers

To the nearest whole dollar, what is the total cost that would be allocated to a customer who placed eight orders in a year?

Question 17

a.

$397

b.

$20,000

c.

$16,947

d.

$16,550