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 Administrative expenses The distribution of resource consumption across the activity cost pools is as follows: Customer Service 10% 0% 0% 90% 30% 60% Driver and guard wages Vehicle operating expense $ 960,000 390,000 Vehicle depreciation Customer representative salaries and expenses Office expenses 270,000 300,000 160,000 460,000 $ 2,540,000 Administrative expenses Total cost Travel 50% 70% Required: Complete the first stage allocations of costs to activity cost pools. 60% 0% Pickup and Delivery 35% 5% 15% Travel 20% 5% Pickup and Delivery Customer Service other 5% 25% 25% 10% 50% 35% Totals 100% 100% 100% 100% 100% 100% Other Totals
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 Administrative expenses The distribution of resource consumption across the activity cost pools is as follows: Customer Service 10% 0% 0% 90% 30% 60% Driver and guard wages Vehicle operating expense $ 960,000 390,000 Vehicle depreciation Customer representative salaries and expenses Office expenses 270,000 300,000 160,000 460,000 $ 2,540,000 Administrative expenses Total cost Travel 50% 70% Required: Complete the first stage allocations of costs to activity cost pools. 60% 0% Pickup and Delivery 35% 5% 15% Travel 20% 5% Pickup and Delivery Customer Service other 5% 25% 25% 10% 50% 35% Totals 100% 100% 100% 100% 100% 100% Other Totals
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
Administrative expenses
The distribution of resource consumption across the activity cost pools is as follows:
Customer
Service
10%
0%
0%
90%
30%
60%
Driver and guard wages
Vehicle operating expense
$ 960,000
390,000
Vehicle depreciation
Customer representative salaries and expenses
Office expenses
270,000
300,000
160,000
460,000
$ 2,540,000
Administrative expenses
Total cost
Travel
50%
70%
Required:
Complete the first stage allocations of costs to activity cost pools.
60%
0%
Pickup and
Delivery
35%
5%
15%
Travel
20%
5%
Pickup and
Delivery
Customer
Service
other
5%
25%
25%
10%
50%
35%
Totals
100%
100%
100%
100%
100%
100%
Other
Totals](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fe82a9647-d72e-4d9e-8a5e-8eaf97e1e99e%2F3f7e3d6a-eb25-429a-bf2d-9cd92da06505%2Fzxufhv9_processed.png&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
Administrative expenses
The distribution of resource consumption across the activity cost pools is as follows:
Customer
Service
10%
0%
0%
90%
30%
60%
Driver and guard wages
Vehicle operating expense
$ 960,000
390,000
Vehicle depreciation
Customer representative salaries and expenses
Office expenses
270,000
300,000
160,000
460,000
$ 2,540,000
Administrative expenses
Total cost
Travel
50%
70%
Required:
Complete the first stage allocations of costs to activity cost pools.
60%
0%
Pickup and
Delivery
35%
5%
15%
Travel
20%
5%
Pickup and
Delivery
Customer
Service
other
5%
25%
25%
10%
50%
35%
Totals
100%
100%
100%
100%
100%
100%
Other
Totals
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