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Levar Corporation has two operating divisions-a Consumer Division and a Commercial Division. The company's Order Fulfillment Department provides services to both divisions. The variable costs
Levar Corporation has two operating divisions-a Consumer Division and a Commercial Division. The company's Order Fulfillment Department provides services to both divisions. The variable costs of the Order Fulfillment Department are budgeted at $38 per order. The Order Fulfillment Department's fixed costs are budgeted at $333,000 for the year. The fixed costs of the Order Fulfillment Department are determined based on the peak period orders. Percentage of Peak Period Capacity Required 25% 75% Budgeted Orders 2,170 5,750 Consumer Division Commercial Division At the end of the year, actual Order Fulfillment Department variable costs totaled $315,210 and fixed costs totaled $310,990. The Consumer Division had a total of 2,195 orders and the Commercial Division had a total of 5,705 orders for the year. For purposes of evaluation performance, how much Order Fulfillment Department cost should be charged to the Commercial Division at the end of the year? Multiple Choice $485,621 $475,198 $494.672 O $466.540 O
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