Lalajee Travels operates a fleet of AC cars that make scheduled pickups and deliveries in the New Delhi area. The company is implementing an activity-based costing system that has four activity cost pools: Travel, Pickup and Delivery, Customer Service, and Other. The activity measures are miles for the Travel cost pool, number of pickups and deliveries for the Pickup and Delivery cost pool, and number of customers for the Customer Service cost pool. The other cost pool has no activity measure. The following costs will be assigned using the activity-based costing system:

Driver and guard wages

Vehicle operating expenses

Vehicle depreciation

Customer representative salaries and expenses

Office expenses

Total cost

1020,000

480,000

120,000

160,000

620,000

24,00,000

The distribution of resource consumption across the activity cost pool is as follows:

Travel

Pickup and Delivery

Cust. Serv.

Other

Totals

1.Driver and guard wages

2.Vehicle operating expenses

3.Vehicle depreciation

4. Customer representa-

tive salaries and exp.

5. Office expenses

60%

70%

50%

0%

0%

20%

5%

25%

0%

20%

15%

0%

0%

90%

30%

5%

25%

25%

10%

50%

100%

100%

100%

100%

100%

During the year each cost pool is having following volumes:

Travel

Pickup and Delivery

Customer Service

70000 kms

1000 Nos.

4000 customers

Required:

1) Carry out the first stage allocations of costs to activity cost pools and find out the Activity measure rates.

2) Find out the cost to be charged to a customer if he travels from Lajpat Nagar to Vasant Kunj, a distance of 17 kms.