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Extreme Manufacturing Company provides the following ABC costing information: Activities Account inquiry Account billing Account verification accounts Correspondence letters Activity-cost drivers 10,000 hours 5,000,000
Extreme Manufacturing Company provides the following ABC costing information: Activities Account inquiry Account billing Account verification accounts Correspondence letters Activity-cost drivers 10,000 hours 5,000,000 lines Total Costs $500,000 $175,000 $124,500 60,000 accounts $40,500 6,000 letters $840,000 Total costs The above activities are used by Departments A and B as follows: Account inquiry hours Account billing lines Account verification accounts Department A 2,200 hours 900,000 lines 11,000 accounts 1,200 letters Department B 3,700 hours 750,000 lines 9,000 accounts 1,600 letters Correspondence letters How much of account verification costs will be assigned to Department A? OA. $124,500 OB. $22,825 OC. $62,250 OD. $18,675 C
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