Question

Bossie Corporation uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity based costing system: Costs: Wages and salaries $349,000 Depreciation 290,000 Utilities 199,000 Total $838,000 Distribution of resource consumption: Activity Cost Pools Assembly Order Processing Other Total Wages and salaries 35% 30% 35% 100% Depreciation 35% 30% 35% 100%Utilities 25% 65% 10% 100%How much cost, in total, would be allocated in the first-stage allocation to the Assembly activity cost pool?a. $202633b. $215300c. $229600d. $164000

Answer 1

Answer:

$273,400

Explanation:

Given that,

Wages and salaries = $349,000

Depreciation = 290,000

Utilities = 199,000

Total = $838,000

Cost to be allocated to Assembly cost pool :

= (Wages & salaries × 35%) + (Depreciation × 35%) + (Utilities × 25%)

= ($349,000 × 35%) + (290,000 × 35%) + ($199,000 × 25%)

= $122,150 + $101,500 + $49,750

= $273,400