Rogers Company is preparing its annual profit plan. As part of its analysis of the cost of its purchasing activity, management estimates that the $63,000 for purchasing support should be assigned to the individual vendors from the information given as follows:
| |
Vendor A
|
Vendor B
|
|
Units purchased
|
101,000
|
202,000
|
|
Purchase orders (annual)
|
7
|
28
|
|
Number of shipments received
|
14
|
56
|
1. What is the amount of the purchasing costs that should be allocated to Vendor B, assuming Rogers uses number of shipments received to compute activity-based costs?