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Cost Allocation

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Grandolfo Corporation 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:
Wages and salaries 300,000
Depreciation 200,000
Utilities 140,000
Total 640,000

Distribution of resource consumption:
Activity Cost Pools
Assembly Setting Up Other Total
Wages and salaries 45% 35% 20% 100%
Depreciation 20% 40% 40% 100%
Utilities 15% 55% 30% 100%

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

172,000
182,000
128,000
192,000

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The solution explains the fist stage cost allocation under an activity based costing system

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