Extreme Manufacturing Company provides the following ABC costing information:

The above activities are used by Departments A and B as follows:

How much of correspondence costs will be assigned to Department A?
A) $22,000
B) $49,500
C) $11,000
D) $11,242

Question

Extreme Manufacturing Company provides the following ABC costing information:

The above activities are used by Departments A and B as follows:

How much of correspondence costs will be assigned to Department A?
A) $22,000 
B) $49,500 
C) $11,000 
D) $11,242

Quizplus · Accepted Answer

Correspondence costs - Department A = ($22,000 ÷ 4,000) × 2,000 = $11,000

Extreme Manufacturing Company Provides the Following ABC Costing Information