Question: Davis Company uses an activity-based costing system in which there are three activity cost pools. The company has provided the following data concerning its costs
Davis Company uses an activity-based costing system in which there are three activity cost pools. The company has provided the following data concerning its costs and its activity-based costing system:
| Costs: | |
| Manufacturing overhead | $400,000 |
| Selling and administrative expenses | 200,000 |
| Total | $600,000 |
Distribution of Resource Consumption:
| Activity Cost Pools | ||||
| Order Size | Customer Support | Other | Total | |
| Manufacturing overhead | 35% | 55% | 10% | 100% |
| Selling and administrative expenses | 50% | 30% | 20% | 100% |
The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs. You have been asked to complete the first-stage allocation of the costs to the activity cost pools.
How much cost, in total, would be allocated in the first-stage allocation to the Order Size activity cost pool?
Multiple Choice
$210,000
$240,000
$255,000
$300,000
The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs. You have been asked to complete the first-stage allocation of the costs to the activity cost pools.
How much cost, in total, would be allocated in the first-stage allocation to the Customer Support activity cost pool?
Multiple Choice
$180,000
$255,000
$280,000
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