12) Extreme Manufacturing Company provides the following ABC costing information: Total Costs Activity-cost $280,000 $350,000 $93,750 $29,000 $752,750 drivers Account inquiry Account billing 14,000 hours 7,000,000 lines Account verification accounts 50,000 accounts Correspondence letters Total costs 4,000 letters Dr. Audeh A 3 The above activities are used by Departments A and Bas follows: Department A Department B Account inquiry hours Account billing lines 2100 hours 3600 hours 500,000 lines 7,000 accounts 350,000 lines Account verification accounts 5,000 accounts Correspondence letters 1200 letters 1600 letters How much of the total costs will be assigned to Department A? A) $88,825 B) $118,825 C) $120,000 D) $85,075

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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12) Extreme Manufacturing Company provides the following ABC costing information:
drivers
Total Costs
Activity-cost
$280,000
$350,000
$93,750
$29,000
$752,750
Account inquiry
Account billing
14,000 hours
7,000,000 lines
Account verification accounts
50,000 accounts
Correspondence letters
Total costs
4,000 letters
Dr.Audeh Ah
3
The above activities are used by Departments A and B as follows:
Department A
Department B
Account inquiry hours
Account billing lines
2100 hours
3600 hours
500,000 lines
350,000 lines
Account verification accounts
7,000 accounts
5,000 accounts
Correspondence letters
1200 letters
1600 letters
How much of the total costs will be assigned to Department A?
A) $88,825
B) $118,825
C) $120,000
D) $85,075
Transcribed Image Text:12) Extreme Manufacturing Company provides the following ABC costing information: drivers Total Costs Activity-cost $280,000 $350,000 $93,750 $29,000 $752,750 Account inquiry Account billing 14,000 hours 7,000,000 lines Account verification accounts 50,000 accounts Correspondence letters Total costs 4,000 letters Dr.Audeh Ah 3 The above activities are used by Departments A and B as follows: Department A Department B Account inquiry hours Account billing lines 2100 hours 3600 hours 500,000 lines 350,000 lines Account verification accounts 7,000 accounts 5,000 accounts Correspondence letters 1200 letters 1600 letters How much of the total costs will be assigned to Department A? A) $88,825 B) $118,825 C) $120,000 D) $85,075
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