Danforth Industries had the following activities, traceable costs, and physicalflow of driver units:••Technical support (hours): $380,000 total cost, 10,000 hoursShipping processing (orders): $275,000 total cost, 3,600,000 orders•Account reconciliation (accounts): $145,000 total cost, 38,000 accountsCustomer correspondence (letters): $50,000 total cost, 4,800 lettersThe above activities are used by Division A and Division B as follows:Technical support hours: 2,500 hours (Division A), 4,500 hours (DivisionB)Shipping processing orders: 480,000 orders (Division A), 210,000 orders(Division B)Account reconciliation accounts: 9,500 accounts (Division A), 8,200accounts (Division B)Customer correspondence letters: 1,100 letters (Division A), 1,600letters (Division B)How much of the technical support cost will be assigned to Division A?

Step 1: Definition of Activity-Based Cost AllocationActivity-based cost allocation assigns indirect…

Answered: Danforth Industries had the following…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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How much of the customers support will be assigned ?
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