Question
Extreme Manufacturing Company provides the following ABC costing information: Activities Total Costs Activity cost drivers Account inquiry $140,000 14,000 hours Account billing $280,000 7,000,000 lines
Extreme Manufacturing Company provides the following ABC costing information:
Activities | Total Costs | Activity cost drivers | |
Account inquiry | $140,000 | 14,000 hours | |
Account billing | $280,000 | 7,000,000 lines | |
Account verification accounts | $98,750 | 50,000 accounts | |
Correspondence letters | $17,250 | 3,000 letters | |
Total costs | $536,000 |
The above activities are used by Departments A and B as follows:
Department A | Department B | ||
Account inquiry hours | 2,900 hours | 4,400 hours | |
Account billing lines | 800,000 lines | 650,000 lines | |
Account verification accounts | 11,000 accounts | 9,000 accounts | |
Correspondence letters | 1,200 letters | 1,600 letters |
How much of the total costs will be assigned to Department B?
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