SecuriCorp operates a fleet of armored cars that make scheduled pickups and deli
ID: 2553311 • Letter: S
Question
SecuriCorp operates a fleet of armored cars that make scheduled pickups and deliveries in the Los Angeles 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: $ 860,000 290,000 170,000 Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses Administrative expenses Total cost 200,000 60,000 360,000 $1,940,000 The distribution of resource consumption across the activity cost pools is as follows: Travel 50% 708 608 Pickup and Delivery 35% 5% 158 Customer Service 108 0% 08 Other 5% 25% 25% Totals 100% 100% 100% Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses Administrative expenses 08 08 0$ 08 208 5$ 908 308 108 50$ 358 100% 100% 100% 608Explanation / Answer
Travel Pickup and delivery Customer service Other Totals Driver and guard wages 430000 301000 86000 43000 860000 Vehicle operating expense 203000 14500 0 72500 290000 vehicle depreciation 102000 25500 0 42500 170000 Customer representative salaries and expenses 0 0 180000 20000 200000 Office expenses 0 12000 18000 30000 60000 Administrative expenses 0 18000 216000 126000 360000 Total cost 735000 371000 500000 334000 1940000