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Exercise 7-2 (Algo) First Stage Allocation [LO7-2] SecuriCorp operates a fleet of armored cars that make scheduled pickups and deliveries in the Los Angeles
Exercise 7-2 (Algo) First Stage Allocation [LO7-2] SecuriCorp operates a fleet of armored cars that make scheduled pickups and deliveries in the Los Angeles area. The company is Implementing an activity-based costing system that has four activity cost pools: Travel, Pickup and Delivery, Customer Service, and Other. The activity measures are miles for the Travel cost pool, number of pickups and deliveries for the Pickup and Delivery cost pool, and number of customers for the Customer Service cost pool. The Other cost pool has no activity measure because it is an organization-sustaining activity. The following costs will be assigned using the activity-based costing system: Driver and guard wages Vehicle operating expense vehicle depreciation $1,060,000 490,000 370,000 Customer representative salaries and expenses 400,000 office expenses 260,000 Administrative expenses 560,000 Total cost $3,140,000 The distribution of resource consumption across the activity cost pools is as follows: Pickup and Customer Driver and guard wages Travel Delivery Service other Totals 50% 35% 10% Vehicle operating expense 5% 100% 70% 5% 0% Vehicle depreciation 25% 100% 60% 15% 20 Customer representative salaries and 25% 100% expenses 90% office expenses 10% 100% 0% Administrative expenses 20% 30% 50% 100% 0x 60% 35% 100% Required: Complete the first stage allocations of costs to activity cost pools. Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Administrative expenses Office expenses Total cost Travel Pickup and Delivery Customer Service Other Totals $ 0 O 0 0 0 $ 0 $ 0 $ 0 $ 0 $ 0
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