Answered step by step
Verified Expert Solution
Question
1 Approved Answer
International Gems sells fine jewelry and has implemented activity - based costing. Costs in the shipping department have been divided into three cost pools. The
International Gems sells fine jewelry and has implemented activitybased costing. Costs in the shipping department have been divided into three cost pools. The first cost pool contains costs that are related to packaging and shipping. International has determined that the number of boxes shipped is an appropriate cost driver for these costs. The second cost pool is made up of costs related to the final inspection of each item before it is shipped and the cost driver for this pool is the number of individual items that are inspected. The final cost pool is used for general operations of the department and the cost driver is the number of orders. Information about the activities is summarized below:
Cost Pool Estimated Total Costs Cost Driver Estimated Annual Activity
Packaging and shipping $ Number of boxes shipped boxes
Final inspection Number of individual items inspected items
General operations Number of orders orders
During December, items were sold, reflecting orders that were packed and shipped in boxes. What amount is allocated to each order for general operations of the department?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started