Share
Explore BrainMass

First-stage allocation to the order size activity cost pool

Dimaio Company uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity based costing system:

Costs:
Manufacturing overhead 580,000
Selling and administrative expenses 240,000
Total 820,000

Distribution of resource consumption:
Activity Cost Pools
Order Customer
Size Support Other Total
Manufacturing overhead 50% 40% 10% 100%
Selling and administrative expenses 5% 75% 20% 100%

The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs.

You have been asked to complete the first-stage allocation of costs to the activity cost pools.
Reference: 8-5

How much cost, in total, would be allocated in the first-stage allocation to the Order Size activity cost pool?

302,000
410,000
41,000
225,500

Solution Summary

This provides the steps to compute the first-stage allocation to the Order Size activity cost pool

$2.19