2.3) Tylerâs Consulting Company has purchased a new $15,000 copier.This overhead cost will be shared by the purchasing, accounting,and information technology departments since those are the onlydepartments which will be able to access the machine. The companyhas decided to allocate the cost based on the number of copies madeby each department. The copier is estimated to provide 1 millioncopies over its life. Each division has estimated the number ofcopies which will be made over the life of the copier.
Purchasing 350,000
Accounting 200,000
Information Tech 425,000
Note: Cost allocations are computed to 4 significant digits.Resulting values are rounded to the whole dollar.
If the purchasing department makes 140,260 copies this year whatwill be their allocated overhead?
2.4) Which of the following costs are always incremental andrelevant in decision analysis?
opportunity costs and joint costs
joint costs and avoidable costs
avoidable costs and opportunity costs
sunk costs and avoidable costs
Fast Delivery Company delivers packages and business documents forlocal businesses located in the Houston metropolitan area. If thecompany decided to adopt an ABC costing system to accumulate costsfor its service, what would be an appropriate cost driver to usefor the cost of the packaging envelopes provided tocustomers?
Number of miles to be driven in the delivery
Number of customers
Amount of fuel used in the truck
Number of packages
2.3) Tylerâs Consulting Company has purchased a new $15,000 copier.This overhead cost will be shared by the purchasing, accounting,and information technology departments since those are the onlydepartments which will be able to access the machine. The companyhas decided to allocate the cost based on the number of copies madeby each department. The copier is estimated to provide 1 millioncopies over its life. Each division has estimated the number ofcopies which will be made over the life of the copier.
Purchasing 350,000
Accounting 200,000
Information Tech 425,000
Note: Cost allocations are computed to 4 significant digits.Resulting values are rounded to the whole dollar.
If the purchasing department makes 140,260 copies this year whatwill be their allocated overhead?
2.4) Which of the following costs are always incremental andrelevant in decision analysis?
opportunity costs and joint costs
joint costs and avoidable costs
avoidable costs and opportunity costs
sunk costs and avoidable costs
Fast Delivery Company delivers packages and business documents forlocal businesses located in the Houston metropolitan area. If thecompany decided to adopt an ABC costing system to accumulate costsfor its service, what would be an appropriate cost driver to usefor the cost of the packaging envelopes provided tocustomers?
Number of miles to be driven in the delivery
Number of customers
Amount of fuel used in the truck
Number of packages
