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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: Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and $ 1,140,000 570,000 450,000 480,000 expenses Office expenses Administrative expenses 340,000 640,000 Total cost $ 3,620,000 The distribution of resource consumption across the activity cost pools is as follows: Pickup and Customer Service 10% Delivery Totals 100% Travel Other Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and 50% 70% 60% 35% 5% 100% 100% 5% 25% 15% 0% 25% expenses 0% 0% 90% 10% 100% Office expenses Administrative expenses 0% 20% 30% 50% 100% 0% 5% 60% 35% 100% Required: Complete the first stage allocations of costs to activity cost pools. Pickup and Customer Travel Delivery Service Other Totals Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses Administrative expenses Total cost

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: Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and $ 1,140,000 570,000 450,000 480,000 expenses Office expenses Administrative expenses 340,000 640,000 Total cost $ 3,620,000 The distribution of resource consumption across the activity cost pools is as follows: Pickup and Customer Service 10% Delivery Totals 100% Travel Other Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and 50% 70% 60% 35% 5% 100% 100% 5% 25% 15% 0% 25% expenses 0% 0% 90% 10% 100% Office expenses Administrative expenses 0% 20% 30% 50% 100% 0% 5% 60% 35% 100% Required: Complete the first stage allocations of costs to activity cost pools. Pickup and Customer Travel Delivery Service Other Totals Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses Administrative expenses Total cost

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter4: Activity-based Costing
Section: Chapter Questions
Problem 4CE: Larsen, Inc., produces two types of electronic parts and has provided the following data: There are...
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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: Driver and guard wages Vehicle operating expense Vehicle depreciation $ 1,140,000 570,000 450,000 Customer representative salaries and 480,000 expenses Office expenses Administrative expenses 340,000 640,000 Total cost $ 3,620,000 The distribution of resource consumption across the activity cost pools is as follows: Pickup and Customer Travel Other Totals Delivery 35% Service Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and 50% 10% 5% 100% 70% 5% 0% 25% 100% 60% 15% 0% 25% 100% 0% 0% 90% 10% expenses Office expenses Administrative expenses 100% 100% 100% 0% 20% 30% 50% 0% 5% 60% 35% Required: Complete the first stage allocations of costs to activity cost pools. Pickup and Customer Travel Delivery Service Other Totals Driver and guard wages $ Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses Administrative expenses Total cost $ 0 $ 0 $ 0 $ 0 $
Transcribed Image Text: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: Driver and guard wages Vehicle operating expense Vehicle depreciation $ 1,140,000 570,000 450,000 Customer representative salaries and 480,000 expenses Office expenses Administrative expenses 340,000 640,000 Total cost $ 3,620,000 The distribution of resource consumption across the activity cost pools is as follows: Pickup and Customer Travel Other Totals Delivery 35% Service Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and 50% 10% 5% 100% 70% 5% 0% 25% 100% 60% 15% 0% 25% 100% 0% 0% 90% 10% expenses Office expenses Administrative expenses 100% 100% 100% 0% 20% 30% 50% 0% 5% 60% 35% Required: Complete the first stage allocations of costs to activity cost pools. Pickup and Customer Travel Delivery Service Other Totals Driver and guard wages $ Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses Administrative expenses Total cost $ 0 $ 0 $ 0 $ 0 $
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