Dudley & Spahr,Attorneys at Law,provide a variety of legal services.The law firm uses an activity-based costing system and has developed the following activity pool cost rates:

Cost and activity data related to two clients is as follows:

How much overhead cost would be allocated to Client 103 using the activity-based costing system?

Question

Dudley & Spahr,Attorneys at Law,provide a variety of legal services.The law firm uses an activity-based costing system and has developed the following activity pool cost rates:

Cost and activity data related to two clients is as follows:

How much overhead cost would be allocated to Client 103 using the activity-based costing system?

Quizplus · Accepted Answer

Using the activity-based costing system, the overhead cost to be allocated to Client 103 can be calculated as follows:

Activity cost for client 103 = (Number of units of activity used by client 103 * Activity pool cost rate)
= (1500 * $2.075) + (50 * $92.50) + (5 * $800)
= $3,113

Therefore, the best choice is B.

Dudley & Spahr,Attorneys at Law,provide a Variety of Legal Services