Question
Pitt Jones Company had the following activities, allocated costs, and allocation bases: Cost Pool MOH Costs Allocation Base Account inquiry (hours) $60,000 2,000 hours Account
Pitt Jones Company had the following activities, allocated costs, and allocation bases:
Cost Pool | MOH 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 their regional offices. Below is the actual activity.
Cost Pool | 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) | 50 letters | 100 letters |
Calculate the PDOR for each cost pool.
How much MOH was assigned to the Northeast Office? Midwest Office?
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