Folly Beach Industries decides to price delivery service according to the result

Question

Folly Beach Industries decides to price delivery service according to the results of a recent activity-based costing (ABC) study. The study indicates Folly Beach should charge $16 per order, 1% of the order's value for general delivery costs, $2.50 per item, and $45 for delivery. A year later, Folly Beach collected the following information for three of its customers:

What are the total delivery costs charged to Customer C during the year?

Folly Beach Industries decides to price delivery service according to the results of a recent activity-based costing (ABC) study. The study indicates Folly Beach should charge $16 per order, 1% of the order's value for general delivery costs, $2.50 per item, and $45 for delivery. A year later, Folly Beach collected the following information for three of its customers:

Folly Beach Industries decides to price delivery service according to the results of a recent activity-based costing (ABC) study. The study indicates Folly Beach should charge $16 per order, 1% of the order's value for general delivery costs, $2.50 per item, and $45 for delivery. A year later, Folly Beach collected the following information for three of its customers: What are the total delivery costs charged to Customer C during the year? $16,863. $20,000. $31,272. $32,272.

Explanation / Answer

Hi,

Please find the answer as follows:

Total Delivery Costs Charged to Customer C = 16*12 + 100000*.01 + 12000*2.5 + 24*45 = 32272

Option D (32272) is the correct answer.

Thanks.

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