Assignment
Webster Company provides the following ABC costing information:
|
Activities
|
Total Costs
|
Activityminus-cost drivers
|
|
Account inquiry hours
|
$250,000
|
10,000 hours
|
|
Account billing lines
|
$125,000
|
5,000,000 lines
|
|
Account verification accounts
|
$50,000
|
50,000 accounts
|
|
Correspondence letters
|
$ 25,000
|
5,000 letters
|
|
Total costs
|
$450,000
|
|
The above activities are used by Departments A and B as follows:
|
Department A
|
Department B
|
|
Account inquiry hours
|
1,000 hours
|
3,000 hours
|
|
Account billing lines
|
200,000 lines
|
300,000 lines
|
|
Account verification accounts
|
10,000 accounts
|
8,000 accounts
|
|
Correspondence letters
|
1,000 letters
|
1,500 letters
|
How much of the account inquiry cost will be assigned to Department A?
A. $5,000 B. $75,000 C. $25,000 D. $250,000
How much of account verification costs will be assigned to Department A?
A. $40,000 B. $25,000 C. $50,000 D. $10,000
How much of the account billing costs will be assigned to Department B?
A. $7,500
B. $25,000
C. $12.500
D. $15,000.