Question

Kelly Corporation uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs: Costs: Wages and salaries $ 360,000 Depreciation 200,000 Occupancy 100,000 Total $ 660,000 The distribution of resource consumption across the three activity cost pools is given below: Activity Cost Pools Total Fabricating Order Processing Other Wages and salaries 15% 60% 25% 100% Depreciation 20% 35% 45% 100% Occupancy 25% 50% 25% 100% How much cost, in total, would be allocated in the first-stage allocation to the Order Processing activity cost pool

Answer 1

Answer:

$336,000

Explanation:

Calculation for How much cost that would be allocated in the first-stage allocation to the Order Processing activity cost pool

Total Order Processing activity cost pool

Wages and salaries: 60% × $360,000

Wages and salaries= $216,000

Depreciation: 35% × $200,000

Depreciation=$70,000

Occupancy : 50% × $100,000

Occupancy=$50,000

TOTAL =$336,000

Therefore the amount of cost that would be allocated in the first-stage allocation to the Order Processing activity cost pool will be $336,000