
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Transcribed Image Text:Foster Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead
costs and its activity-based costing system:
Overhead costs:
Wages and salaries
$ 70,000
Other expenses
50,000
Total
$ 120,000
Distribution of resource consumption:
Activity Cost Pools
Making
Bouquets
Delivery
Other
Total
Wages and salaries
Other expenses
70%
20%
10%
100%
45%
25%
30%
100%
The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs.
The amount of activity for the year is as follows:
Activity Cost Pool
Making bouquets
Delivery
Activity
40,000 bouquets
1,000 deliveries
What would be the total overhead cost per bouquet according to the activity-based costing system? In other words, what would be the overall activity rate for the making
bouquets activity cost pool? (Round to the nearest whole cent.)

Transcribed Image Text:Multiple Choice
$1.79
$2.10
$1.35
$1.73
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