Exercise 6-54 (Static) Two-Stage Cost Allocation-Multiple Choice (LO 6-3) Tacoma Accessories makes two laptop cases, Plastic and Leather, that require direct materials, direct labor, and overhead. The following data refer to operations expected for next quarter. Revenue Direct material Direct labor Overhead: Material handling overhead Fabrication overhead Call center volume: Number of calls Number of call minutes Call center costs: Call-related Tacoma uses a two-stage cost allocation system: It uses direct-material costs to allocate material handling overhead and direct-labor costs to allocate fabrication overhead costs. Call minute-related Westover Travel offers travel packages using both air and ocean travel. Westover offers two packages, Tourist and Premier, that differ in the accommodations, class of travel, and so on. Westover has a call center, which handles customer queries and complaints. The call center tracks the number of calls and the number of call-minutes for customers by the package they have purchased. Expected call center data for next month follow. Total call center costs Tourist 20,000 108,000 Plastic $ 480,000 180,000 60,000 Total $ 200,000 121,500 $ 321,500 Leather $500,000 260,000 40,000 Premier 12,000 162,000 Total $ 980,000 440,000 100,000 O There are two or more cost objects. O There are exactly two cost objects. O None of the above. 198,000 140,000 Required: The system is referred to as a two-stage cost allocation system because: The call center at Westover uses a two-stage cost allocation system: It uses the number of calls to allocate call-related costs and the number of call minutes to allocate call minute-related costs. O Cost is allocated first to intermediate cost pools and from these pools to cost objects. O There are two or more cost pools.

Exercise 6-54 (Static) Two-Stage Cost Allocation-Multiple Choice (LO 6-3) Tacoma Accessories makes two laptop cases, Plastic and Leather, that require direct materials, direct labor, and overhead. The following dato refer to operations expected for next quarter: Tocoma uses a two-stage cost allocation system: it uses direct-materlal costs to allocate material handing overhead and direct-labor costs to allocate fobrication overhead costs: Westover Travel offers travel packages using both air and ocean travel. Westover offers two packages, Tourist and Premier, that differ in the accommodations, class of travel, and so on. Westover has a call center, which handles customer queries and complaints. The call center tracks the number of calls and the number of call-minutes for customers by the package they have purchased. Expected call center data for next month follow. The call center at Westover uses a two-stage cost allocation system: It uses the number of calis to allocate cali-related costs and the number of call minutes to allocate call minute-related costs. Required: The system is referred to as a two-stage cost aliocation system because: Cost is aliocated first to intermediate cost poois and from these pools to cost objects. There are two or more cost poois. There are two or more cost objects: There are exactly two cost objects None of the nbove