Question
Republic Industries decides to price delivery services according to the results of a recent activity-based costing (ABC) study. The study indicates Republic should charge
Republic Industries decides to price delivery services according to the results of a recent activity-based costing (ABC) study. The study indicates Republic should charge $7 per order, 2% of annual order value for general delivery costs, $1.25 per item, and $25 for delivery. A year later, Republic collected the following information for two of its best customers: Cost driver Customer C Customer D Number of orders Number of deliveries 18 7 10 10 Total number of items Annual order value 1,900 $185,000 3,800 $90,000 What are the total delivery costs charged to Customer D during the year? Multiple Choice $6,451. $6,849. $5,049. $6,800.
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