Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Fogle Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs

Fogle Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs and its activity based costing system:

Overhead costs:
Wages and salaries $162,000
Other expenses 61,000
Total

$223,000

Distribution of resource consumption:
Activity Cost Pools
Making Bouquets Delivery Other Total
Wages and salaries 45% 25% 30% 100%
Other expenses 30% 45% 25% 100%

The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs.

The amount of activity for the year is as follows:

Activity Cost Pool Activity
Making bouquets 140,308 bouquets
Delivery 12,700 deliveries

What would be the total overhead cost per delivery according to the activity based costing system? In other words, what would be the overall activity rate for the deliveries activity cost pool? (Round to the nearest whole cent.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Corporate Assessment Auditing A Company Personality

Authors: Adrian Furnham, Barrie Gunter

1st Edition

1138887641, 978-1138887640

More Books

Students also viewed these Accounting questions