Answer the following questions using the information below:
Happy Valley Land and Snow Company provides the following ABC costing information:
The above activities used by their three departments are:

-How much of the total costs will be assigned to the Lawn Department?
A)$100,000
B)$49,200
C)$200,000
D)$134,600

Question

Answer the following questions using the information below:
Happy Valley Land and Snow Company provides the following ABC costing information:
  The above activities used by their three departments are:
 
-How much of the total costs will be assigned to the Lawn Department?
A)$100,000 
B)$49,200 
C)$200,000 
D)$134,600

Quizplus · Accepted Answer

We can calculate the total cost using the ABC costing information:
Lawn Department:
10,000(80+50+20) + 300(10+15) = $1,049,000
Garden Department:
6,000(50+40+20) + 200(10+15) = $450,000
Snow Department:
5,000(100+60+40) + 50(10+15) = $800,000
Total Cost = $1,049,000 + $450,000 + $800,000 = $2,299,000

The cost assigned to the Lawn Department is:
(1,049,000/2,299,000) * 100% = 45.66%
Therefore, the cost assigned to the Lawn Department is:
45.66% * $2,299,000 = $1,052,638 ≈ $1,052,600
Hence, the answer is D because the total costs assigned to the Lawn Department is $1,052,600.

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