Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
Related questions
Question
![How much of account verification costs will be assigned to Department A?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fda869df5-01d2-4a6a-a946-415268979e8f%2F1c9a06e4-46c9-4090-a737-fe44fb63b7a1%2F4as8wka_processed.jpeg&w=3840&q=75)
Transcribed Image Text:How much of account verification costs will be assigned to Department A?
![Merriman Company provides the following ABC oosting information:
Activities
Account inquiry hours
Account billing lines
Account verification accounts
Correspondence letters
Total costs
Total Costs
$400,000
$280,000
$150,000
$ 50.000
$880.000
Activity-cost drivers
10,000 hours
4,000,000 lines
40,000 accounts
4,000 letters
The above activities are used by Departments A and B as follows:
Account inquiry hours
Account billing lines
Account verification accounts
Department A
2,000 hours
400,000 lines
10,000 accounts
1,000 letters
Department B
4,000 hours
200,000 lines
8,000 accounts
1,600 letters
Correspondence letters](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fda869df5-01d2-4a6a-a946-415268979e8f%2F1c9a06e4-46c9-4090-a737-fe44fb63b7a1%2Fxmpoxzo_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Merriman Company provides the following ABC oosting information:
Activities
Account inquiry hours
Account billing lines
Account verification accounts
Correspondence letters
Total costs
Total Costs
$400,000
$280,000
$150,000
$ 50.000
$880.000
Activity-cost drivers
10,000 hours
4,000,000 lines
40,000 accounts
4,000 letters
The above activities are used by Departments A and B as follows:
Account inquiry hours
Account billing lines
Account verification accounts
Department A
2,000 hours
400,000 lines
10,000 accounts
1,000 letters
Department B
4,000 hours
200,000 lines
8,000 accounts
1,600 letters
Correspondence letters
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