Question
Wollan Corporation has two operating divisionsan East Division and a West Division. The company's Logistics Department services both divisions. The variable costs of the Logistics
Wollan Corporation has two operating divisionsan East Division and a West Division. The company's Logistics Department services both divisions. The variable costs of the Logistics Department are budgeted at $48 per shipment. The Logistics Department's fixed costs are budgeted at $362,400 for the year. The fixed costs of the Logistics Department are determined based on peak-period demand. Percentage of Peak-period Capacity Required Budgeted Shipments East Division 35% 1,630 West Division 65% 5,860 At
the end of the year, actual Logistics Department variable costs totaled $378,480 and fixed costs totaled $378,000. The East Division had a total of 2,360 shipments and the West Division had a total of 5,240 shipments for the year.
How much Logistics Department cost should be allocated to the West Division at the end of the year?
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