Extreme Manufacturing Company provides the following ABC costing information:

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

How much of the account inquiry cost will be assigned to Department A?
A)$54,000
B)$320,000
C)$160,000
D)$84,000

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 the account inquiry cost will be assigned to Department A?
A)$54,000 
B)$320,000 
C)$160,000 
D)$84,000

Quizplus · Accepted Answer

Account inquiry costs - Department A = ($320,000 ÷ 16,000)× 2,700 = $54,000

Extreme Manufacturing Company Provides the Following ABC Costing Information