Allocation to the customer support activity cost
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Diehl 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 $480,000
Selling and admin. expenses $100,000
Total $580,000
Distribution of resource consumption:
Activity Cost Pools
Order Customer
Size Support Other Total
Manufacturing overhead 5% 85% 10% 100%
Selling and admin. expenses 60% 20% 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.
88. How much cost, in total, would be allocated in the first-stage allocation to the Customer Support activity cost pool?
A) $304,500 C) $116,000
B) $493,000 D) $428,000
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Solution Summary
first-stage allocation to the Customer Support activity cost pool
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