Question

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 $162,000
  Other expenses 61,000
  Total

$223,000

  Distribution of resource consumption:
   Activity Cost Pools
   Making
Bouquets
Delivery Other Total
  Wages and salaries 45%     25%     30%     100%   
  Other expenses 30%     45%     25%     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 140,308 bouquets  
  Delivery 12,700 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.)

$4.92 per delivery

$6.21 per delivery

$3.64 per delivery

$5.35 per delivery

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