Question:
Dimaio Company uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity based costing system:
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Overhead costs:
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|
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Manufacturing overhead
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$580,000
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Selling and administrative expenses v
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240,000
|
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Total
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$820,000
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Distribution of resource consumption:
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Activity Cost Pools
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|
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Order Size
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Customer Support
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Other
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Total
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Manufacturing overhead
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50%
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40%
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10%
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100%
|
|
Selling and administrative expenses
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5%
|
75%
|
20%
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100%
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The "Other" activity cost pool consists of the costs of idle capacity and organization sustaining costs.
You have been asked to complete the first-stage allocation of costs to the activity cost pools.
How much cost, in total, would be allocated in the first-stage allocation to the Order Size activity cost pool?
A) $302,000
B) $41,000
C) $225,500
D) $410,000