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.)
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.)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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