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QUESTION 60 First Dcor has analyzed the indirect costs associated with servicing its various customers in order to assess customer profitability. Results for the year
QUESTION 60 First Dcor has analyzed the indirect costs associated with servicing its various customers in order to assess customer profitability. Results for the year appear below: Cost $400,000 120,000 Cost Driver Number of orders Quantity 40,000 8,000 Number of orders Cost Pool Processing electronic orders Processing non-electronic orders Picking orders Packaging orders Returns 240,000 120,000 Number of different products ordered Number of items ordered Number of returns 180,000 15,000 150,000 3,000 What is the cost allocation for two Internet orders for 22 items with 7 different products and one return? $65.40 $33.20 $60.40 $40.40 QUESTION 62 First Dcor has analyzed the indirect costs associated with servicing its various customers in order to assess customer profitability. Results for the year appear below: Cost $400,000 120,000 Quantity 40,000 8,000 Cost Pool Processing electronic orders Processing non-electronic orders Picking orders Packaging orders Returns Cost Driver Number of orders Number of orders Number of different products ordered Number of items ordered Number of returns 240,000 180,000 15,000 120,000 150,000 3,000 One customer of First Dcor placed 30 electronic orders with a total selling price of $25,400. The direct cost of these orders is $17,200. The orders consist of five different products with a total of 2,200 items, and two returns. Using an activity-based costing method, how much are the indirect costs associated with serving this customer? $2,960 $996 $2,660 $3,110
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