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L Company, a manufacturer of electronics, had the following activities, allocated costs, and allocation bases: Activities Allocated Costs Allocation Base Account inquiry (hours) $60,000 2,000
L Company, a manufacturer of electronics, had the following activities, allocated costs, and allocation bases:
Activities | Allocated Costs | Allocation Base |
Account inquiry (hours) | $60,000 | 2,000 hours |
Account billing (lines) | $30,000 | 20,000 lines |
Account verification (accounts) | $15,000 | 20,000 accounts |
Correspondence (letters) | $10,000 | 1,000 letters |
The above activities are carried out at two of its regional offices.
Northeast Office | Midwest Office | |
Account inquiry (hours) | 100 hours | 200 hours |
Account billing (lines) | 10,000 lines | 7,000 lines |
Account verification (accounts) | 1,000 accounts | 600 accounts |
Correspondence (letters) | 300 letters | 500 letters |
How much of the correspondence costs will be assigned to the Midwest Office?
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