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SecuriCorp operates a fleet of armored cars that make scheduled pickups and deliveries 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 f 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 expenses office expenses Administrative expenses Total cost Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses office expenses Administrative expenses $ 900,000 330,000 210,000 The distribution of resource consumption across the activity cost pools is as follows: Pickup and Customer Service 10% 240,000 100,000 400,000 $ 2,180,000 Driver and guard wagos Travel 50% 70% 60% 0% 0% 0% Delivery 35% 5% 15% Required: Complete the first stage allocations of costs to activity cost pools. Travel 0% 20% 5% Pickup and Delivery 0% 0% 90% 30% 60% Other 5% 25% 25% 10% 50% 35% Customer Service Totals 100% 100% 100% 100% 100% 100% Other Totals

SecuriCorp operates a fleet of armored cars that make scheduled pickups and deliveries 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 f 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 expenses office expenses Administrative expenses Total cost Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses office expenses Administrative expenses $ 900,000 330,000 210,000 The distribution of resource consumption across the activity cost pools is as follows: Pickup and Customer Service 10% 240,000 100,000 400,000 $ 2,180,000 Driver and guard wagos Travel 50% 70% 60% 0% 0% 0% Delivery 35% 5% 15% Required: Complete the first stage allocations of costs to activity cost pools. Travel 0% 20% 5% Pickup and Delivery 0% 0% 90% 30% 60% Other 5% 25% 25% 10% 50% 35% Customer Service Totals 100% 100% 100% 100% 100% 100% Other Totals

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter4: Activity-based Costing
Section: Chapter Questions
Problem 7E: The management of Nova Industries Inc. manufactures gasoline and diesel engines through two...
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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 expenses Office expenses Administrative expenses Total cost Driver and guard wages Vehicle operating expense The distribution of resource consumption across the activity cost pools is as follows: Pickup and Customer Service 10% Vehicle depreciation Customer representative salaries and expenses Office expenses Administrative expenses $ 900,000 330,000 210,000 Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses 240,000 100,000 400,000 $ 2,180,000 Administrative expenses Total cost Travel 50% 70% 60% 0% 0% 0% Delivery 35% Required: Complete the first stage allocations of costs to activity cost pools. Travel 5% 15% 0% 20% 5% Pickup and Delivery 0 $ 0% 0% 90% 30% 60% Other 5% 25% 25% 0 $ 10% 50% 35% Customer Service 0 Totals 100% 100% 100% 100% 100% 100% Other 0 LA 69 Totals 0 - 0 C 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 Customer representative salaries and expenses Office expenses Administrative expenses Total cost Driver and guard wages Vehicle operating expense The distribution of resource consumption across the activity cost pools is as follows: Pickup and Customer Service 10% Vehicle depreciation Customer representative salaries and expenses Office expenses Administrative expenses $ 900,000 330,000 210,000 Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses Office expenses 240,000 100,000 400,000 $ 2,180,000 Administrative expenses Total cost Travel 50% 70% 60% 0% 0% 0% Delivery 35% Required: Complete the first stage allocations of costs to activity cost pools. Travel 5% 15% 0% 20% 5% Pickup and Delivery 0 $ 0% 0% 90% 30% 60% Other 5% 25% 25% 0 $ 10% 50% 35% Customer Service 0 Totals 100% 100% 100% 100% 100% 100% Other 0 LA 69 Totals 0 - 0 C 0 0 0
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