Exercise 7-2 (Algo) First Stage Allocation [LO7-2] SecuriCorp operates a fleet of armored cars that make scheduled pickups and deliveries in the Los Angeles area. The company is implementing an activity-based costing system with four activity cost pools: Travel, Pickup and Delivery, Customer Service, and Other. The activity measures are miles for the Travel cost pool, number of pickups and deliveries for the Pickup and Delivery cost pool, and number of customers for the Customer Service cost pool. The Other cost pool has no activity measure because it is an organization- sustaining activity. The following costs will be assigned using the activity-based costing system: Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses Administrative expenses Total cost $ 1,120,000 550,000 430,000 Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses Administrative expenses 460,000 320,000 620,000 $ 3,500,000 The distribution of resource consumption across the activity cost pools is as follows: Pickup and Customer Delivery Service 35% 10% 5% 0% 15% 0% Travel 50% 70% 60% 0% 0% 08 Required: Complete the first stage allocations of costs to activity cost pools. 0% 20% 5% 90% 30% 60% Other 5% 25% 25% 10% 50% 35% Totals 100% 100% 100% 1001 100% 100%
Exercise 7-2 (Algo) First Stage Allocation [LO7-2] SecuriCorp operates a fleet of armored cars that make scheduled pickups and deliveries in the Los Angeles area. The company is implementing an activity-based costing system with four activity cost pools: Travel, Pickup and Delivery, Customer Service, and Other. The activity measures are miles for the Travel cost pool, number of pickups and deliveries for the Pickup and Delivery cost pool, and number of customers for the Customer Service cost pool. The Other cost pool has no activity measure because it is an organization- sustaining activity. The following costs will be assigned using the activity-based costing system: Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses Administrative expenses Total cost $ 1,120,000 550,000 430,000 Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses Administrative expenses 460,000 320,000 620,000 $ 3,500,000 The distribution of resource consumption across the activity cost pools is as follows: Pickup and Customer Delivery Service 35% 10% 5% 0% 15% 0% Travel 50% 70% 60% 0% 0% 08 Required: Complete the first stage allocations of costs to activity cost pools. 0% 20% 5% 90% 30% 60% Other 5% 25% 25% 10% 50% 35% Totals 100% 100% 100% 1001 100% 100%
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Exercise 7-2 (Algo) First Stage Allocation [LO7-2]
SecuriCorp operates a fleet of armored cars that make scheduled pickups and deliveries in the Los Angeles area. The company is
implementing an activity-based costing system with four activity cost pools: Travel, Pickup and Delivery, Customer Service, and Other.
The activity measures are miles for the Travel cost pool, number of pickups and deliveries for the Pickup and Delivery cost pool, and
number of customers for the Customer Service cost pool. The Other cost pool has no activity measure because it is an organization-
sustaining activity. The following costs will be assigned using the activity-based costing system:
Driver and guard wages
Vehicle operating expense
Vehicle depreciation
Customer representative salaries and
expenses
Office expenses
Administrative expenses
Total cost
Driver and guard wages
Vehicle operating expense
Vehicle depreciation
Customer representative salaries and
expenses
Office expenses
$ 1,120,000
550,000
430,000
The distribution of resource consumption across the activity cost pools is as follows:
Pickup and
Delivery
35%
Customer
Service
10%
5%
15%
Administrative expenses
460,000
320,000
620,000
$ 3,500,000
Travel
50%
70%
60%
0%
0%
0%
Required:
Complete the first stage allocations of costs to activity cost pools.
0%
20%
5%
0%
90%
30%
60%
Other
5%
25%
25%
10%
50%
35%
Totals
100%
100%
100%
100
100%
100%](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe6069db0-f496-4c11-99c9-1e809a876661%2F238ad5ef-390c-43c1-8325-603efc56fe6e%2F90f731h_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Exercise 7-2 (Algo) First Stage Allocation [LO7-2]
SecuriCorp operates a fleet of armored cars that make scheduled pickups and deliveries in the Los Angeles area. The company is
implementing an activity-based costing system with four activity cost pools: Travel, Pickup and Delivery, Customer Service, and Other.
The activity measures are miles for the Travel cost pool, number of pickups and deliveries for the Pickup and Delivery cost pool, and
number of customers for the Customer Service cost pool. The Other cost pool has no activity measure because it is an organization-
sustaining activity. The following costs will be assigned using the activity-based costing system:
Driver and guard wages
Vehicle operating expense
Vehicle depreciation
Customer representative salaries and
expenses
Office expenses
Administrative expenses
Total cost
Driver and guard wages
Vehicle operating expense
Vehicle depreciation
Customer representative salaries and
expenses
Office expenses
$ 1,120,000
550,000
430,000
The distribution of resource consumption across the activity cost pools is as follows:
Pickup and
Delivery
35%
Customer
Service
10%
5%
15%
Administrative expenses
460,000
320,000
620,000
$ 3,500,000
Travel
50%
70%
60%
0%
0%
0%
Required:
Complete the first stage allocations of costs to activity cost pools.
0%
20%
5%
0%
90%
30%
60%
Other
5%
25%
25%
10%
50%
35%
Totals
100%
100%
100%
100
100%
100%
Transcribed Image Text:The distribution of resource consumption across the activity cost pools is as follows:
Pickup and
Delivery
35%
5%
15%
Driver and guard wages
Vehicle operating expense
Vehicle depreciation.
Customer representative salaries and
expenses
Office expenses
Administrative expenses
Driver and guard wages
Vehicle operating expense
Vehicle depreciation
Customer representative salaries and expenses
Office expenses
Travel
50%
70%
60%
Required:
Complete the first stage allocations of costs to activity cost pools.
Administrative expenses
Total cost
0%
0%
0%
Travel
0%
20%
5%
Pickup and
Delivery
Customer
Service
10%
0%
0%
90%
30%
60%
Customer
Service
Other
5%
25%
25%
10%
50%
35%
Totals
100%
100%
100%
100%
100%
100%
Other
Totals
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