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Problem 7 (10 POINTS) Pitt Jones Company had the following activities, allocated costs, and allocation bases: Allocation Base 2,000 hours 20,000 lines 20,000 accounts 1,000

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Problem 7 (10 POINTS) Pitt Jones Company had the following activities, allocated costs, and allocation bases: Allocation Base 2,000 hours 20,000 lines 20,000 accounts 1,000 letters Allocated Costs $60,000 30,000 Activities Account inquiry (hours) Account billing (lines) Account verification (accounts) 15,000 Correspondence (letters) 10,000 The above activities are used by departments P and Q: Department Q 200 hours Department P Account inquiry (hours) Account billing (lines) Account verification (accounts) 1,000 accounts Correspondence (letters) 100 hours 7,000 lines 600 accounts 100 letters 10,000 lines 50 letters 1) What is the cost per driver unit for the account inquiry activity? What is the cost per driver unit for the account billing activity? 2) What is the cost per driver unit for the account verification activity? 3) What is the cost per driver unit for the correspondence activity? 4) How much of the account inquiry cost will be assigned to Department Q? 5) 6) How much of the correspondence cost will be assigned to Department P? How much of the account verification costs will be assigned to Department P? 7)

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