Solution-Complete first-stage allocations of costs to cost

Complete first-stage allocations of costs to cost pools

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Reference no: EM131798910

QUESTION - VaultOnWheels Corporation operates a fleet of armored cars that make scheduled pickups and deliveries for its customers in the Phoenix area. The company is implementing an activity-based costing system that has four activity cost pools: Travel, Pickup and Delivery, Customer Service, and Other. The activity measures are miles for the Travel cost pool, number of pickups and deliveries for the Pickup and Delivery cost pool, and number of customers for the Customer Service cost pool. The Other cost pool has no activity measure because it is an organization-sustaining activity. The following costs will be assigned using the activity-based costing system:

Driver and guard wages	$900,000
Vehicle operating expense	330,000
Vehicle depreciation	210,000
Customer representative salaries and expenses	240,000
Office expenses	100,000
Administrative expenses	400,000
Total cost	$2,180,000

The distribution of resource consumption across the activity cost pools is as follows:

	Travel	Pickup and Delivery	Customer Service	Other	Totals
Driver and guard wages	40%	45%	10%	5%	100%
Vehicle operating expense	75%	5%	0%	20%	100%
Vehicle depreciation	70%	10%	0%	20%	100%
Customer representative salaries and expenses	0%	0%	85%	15%	100%
Office expenses	0%	25%	35%	40%	100%
Administrative expenses	0%	5%	55%	40%	100%

Required: Complete the first-stage allocations of costs to activity cost pools.

Reference no: EM131798910

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Complete first-stage allocations of costs to cost pools

Reference no: EM131798910

Reference no: EM131798910

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