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Fogle Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has...

Fogle Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs and its activity based costing system:

Overhead costs:
Wages and salaries	$159,000
Other expenses	62,000
Total	$221,000

Distribution of resource consumption:
	Activity Cost Pools
	Making Bouquets	Delivery	Other	Total
Wages and salaries	45%	20%	35%	100%
Other expenses	45%	50%	5%	100%

The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs.

The amount of activity for the year is as follows:

Activity Cost Pool	Activity
Making bouquets	124,312 bouquets
Delivery	8,200 deliveries

What would be the total overhead cost per delivery according to the activity based costing system? In other words, what would be the overall activity rate for the deliveries activity cost pool? (Round to the nearest whole cent.)

$5.95 per delivery

$7.66 per delivery

$8.52 per delivery

$7.23 per delivery

Fogle Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs and its activity based costing system:

Overhead costs:
Wages and salaries	$178,000
Other expenses	51,000
Total	$229,000

Distribution of resource consumption:
	Activity Cost Pools
	Making Bouquets	Delivery	Other	Total
Wages and salaries	45%	20%	35%	100%
Other expenses	30%	65%	5%	100%

The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs.

The amount of activity for the year is as follows:

Activity Cost Pool	Activity
Making bouquets	46,995 bouquets
Delivery	11,800 deliveries

What would be the total overhead cost per bouquet according to the activity based costing system? In other words, what would be the overall activity rate for the making bouquets activity cost pool? (Round to the nearest whole cent.)

$2.01 per bouquets

$1.93 per bouquets

$2.03 per bouquets

$2.08 per bouquets

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ekkarill92 answered 1 year ago

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