afael Pena&14118 10-19 Time Remaining: 0127:04 Submit Te This Test: 100 pts poss

Question

afael Pena&14118 10-19 Time Remaining: 0127:04 Submit Te This Test: 100 pts possib SL. Exam 2 - ACC 2311 This Question: 2 pts 16 of 27 (14 complete) ? Extreme Manufacturing Company provides the following ABC costing information Astivities Account inquiry Account biltling Account verfication accounts otal CostsAstivity-cost driver 1,000 hours 4,000,000 lines 220,000 220,000 $159 250 $23,000 822,250 70,000 account 000 lettrs otal costs The above activities are used by Departments A and B as follows OA $58,000 OB? $110,000 OC. $88000 OD· $220,000 cick to

Explanation / Answer

Answer is option (A) $58000

Explanation;

Total cost of account enquiry is given = $220000

Total hours = 11000

Thus per hour rate ($220000 / 11000) = $20

Account enquiry hours for Department A = 2900

So, account enquiry cost assigned to department A will be ($20 * 2900) = $58000

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