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Myoung Company, a manufacturer of small appliances, had the following activities, allocated costs, ...

Myoung Company, a manufacturer of small appliances, had the following activities, allocated costs, and allocation bases:

Activities   Allocated Costs   Allocation Base
Account inquiry (hours)   $61,000   2,400 hours
Account billing (lines)   $35,000   17,000 lines
Account verification (accounts)   $13,000   20,000 accounts
Correspondence (letters)   $11,000   1,000 letters

The above activities are carried out at two of its regional offices.

Activities   Northeast Office   Midwest Office
Account inquiry (hours)   120 hours   250 hours
Account billing (lines)   16,000 lines   9,000 lines
Account verification (accounts)   1,500 accounts   600 accounts
Correspondence (letters)   70 letters   150 letters

What is the cost per hour for the account inquiry activity? (Round your answer to the nearest cent.)
A) $11.00
B) $25.42
C) $0.65
D) $2.06

Textbook

Horngren's Financial & Managerial Accounting, The Financial Chapters

Edition: 5^th

Authors: Miller-Nobles, Mattison, Matsumura

Read 413 times

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