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Express Travel decides to price delivery service according to the results of a recent activity-based costing (ABC) study. The study indicates Express Travel should charge

Express Travel decides to price delivery service according to the results of a recent activity-based costing (ABC) study. The study indicates Express Travel should charge $16 per order, 1% of the order's value for general delivery costs, $2.50 per item, and $45 for delivery.
A year later, Express Travel collected the following information for three of its customers:

Cost driverCustomer ACustomer BCustomer C
Number of orders18812
Number of deliveries101024
Number of items2,0004,00012,000
Order value$120,000$80,000$100,000

What are the total delivery costs charged to Customer A during the year?

$5,738.

$6,650.

$6,938.

$20,235.


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