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MobileCash Corporation operates a fleet of armoured cars that make scheduled pickups and deliveries for its customers. The company is implementing an ABC system that
MobileCash Corporation operates a fleet of armoured cars that make scheduled pickups and deliveries for its customers. The company is implementing an ABC system that has four activity cost pools: Travel Pickup and Delivery, Customer Service, and Other. The activity measures are kilometers 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 ABC system: Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses Administrative expenses $ 870,000 290,000 160,000 190,000 45,000 360,000 Total cost $1,915,000 he distribution of resource consumption across the activity cost pools is as follows Pickup and Customer Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries Travel Delivery Service Other Totals 10% 0% 0% 4096 70% 75% 45% 10% 5% 5% 20% 20% 100% 100% 100% nd expenses Office expenses Administrative expenses 0% 0% 0% 0% 20% 5% 85% 30% 50% 50% 45% 100% 100% 100%
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