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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 Othe 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 deprecia ion Customer representative salaries and expenses Office expenses Administrative expenses $ 840,000 270,000 150,000 The distribution of resource consumption across the activity cost pools is as follows: Pickup and Customer Delivery 35% Service 10% 5% 0% 15% 0% Required: 180,000 40,000 340,000 $ 1,820,000 Travel 50% 70% 60% 0% 0% 0% 0% 20% 5% 90% 30% 60% Other 5% 25% 25% 10% 50% 35% Totals 100% 100% 100% 100% 100% 100%

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 Othe 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 deprecia ion Customer representative salaries and expenses Office expenses Administrative expenses $ 840,000 270,000 150,000 The distribution of resource consumption across the activity cost pools is as follows: Pickup and Customer Delivery 35% Service 10% 5% 0% 15% 0% Required: 180,000 40,000 340,000 $ 1,820,000 Travel 50% 70% 60% 0% 0% 0% 0% 20% 5% 90% 30% 60% Other 5% 25% 25% 10% 50% 35% Totals 100% 100% 100% 100% 100% 100%

FINANCIAL ACCOUNTING
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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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: Pickup and Customer Delivery Service 35% 10% 5% 0% 15% 0% Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses $ 840,000 270,000 150,000 Administrative expenses Total cost 180,000 40,000 340,000 $ 1,820,000 $ Required: Complete the first stage allocations of costs to activity cost pools. Travel 50% 70% 60% 0% 0% 0% Travel 20% 5% Pickup and Delivery 0 $ 90% 30% 60% Customer Service 0 $ Other 5% 25% 25% 0 10% 50% 35% $ Totals 100% 100% 100% 100% 100% 100% Other 0 $ $ Totals 0 0 o c 0 0 0 0
Transcribed Image Text: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: Pickup and Customer Delivery Service 35% 10% 5% 0% 15% 0% Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses $ 840,000 270,000 150,000 Administrative expenses Total cost 180,000 40,000 340,000 $ 1,820,000 $ Required: Complete the first stage allocations of costs to activity cost pools. Travel 50% 70% 60% 0% 0% 0% Travel 20% 5% Pickup and Delivery 0 $ 90% 30% 60% Customer Service 0 $ Other 5% 25% 25% 0 10% 50% 35% $ Totals 100% 100% 100% 100% 100% 100% Other 0 $ $ Totals 0 0 o c 0 0 0 0
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