1. Verizon Communications and AT&T allocate their service industry costs using activity-based costing. The following table summarizes the costs and cost drivers:

Activity	Verizon Total Cost ($)	Cost Driver	Cost Driver Quantity	AT&T Total Cost ($)
Customer Support	$2,500,000	Number of clients	5,000 clients	$2,200,000
Data Usage	$3,600,000	Gigabytes	600,000 gigabytes	$3,000,000
Network Maintenance	$1,800,000	Network nodes	15,000 nodes	$1,600,000
Total	$7,900,000			$6,800,000

• Verizon served 4,000 clients, and AT&T served 6,000 clients during the year.
• Allocate service industry costs per client and per gigabyte for Verizon and AT&T using activity-based costing.
• Discuss how differences in data usage costs impact Verizon's and AT&T's service reliability and cost management.