Question

MobileCash Corporation operates a fleet of armoured cars that make scheduled pickups and deliveries for its customers. The company is implementing an ABC system that has four activity cost pools: Travel, Pickup and Delivery, Customer Service, and Other. The activity measures are kilometres for the Travel cost pool, number of pickups and deliveries for the Pickup and Delivery cost pool, and number of customers for the Customer Service cost pool. The Other cost pool has no activity measure. The following costs will be assigned using the ABC system:

  Driver and guard wages

$

897,000

  Vehicle operating expense

308,000

  Vehicle depreciation

169,000

  Customer representative salaries and expenses

199,000

  Office expenses

49,500

  Administrative expenses

378,000

  Total cost

$

2,000,500

The distribution of resource consumption across the activity cost pools is as follows:

Travel

Pickup
and
Delivery

Customer
Service

Other

Totals

  Driver and guard wages

35

%

45

%

15

%

5

%

100

%

  Vehicle operating expense

65

%

10

%

0

%

25

%

100

%

  Vehicle depreciation

65

%

10

%

0

%

25

%

100

%

  Customer representative salaries
    and expenses

0

%

0

%

75

%

25

%

100

%

  Office expenses

0

%

25

%

35

%

40

%

100

%

  Administrative expenses

0

%

15

%

45

%

40

%

100

%

Carry out the first-stage allocations of costs to activity cost pools. (Do not leave any empty spaces; input a 0 wherever it is required.)

	Travel	Pickup and Delivery	Customer Service	Other	Totals
Driver and guard wages
Vehicle operating expense
Vehicle depreciation
Customer representative salaries and expenses
Office expenses
Administrative expenses
Total cost

Answer 1

		Travel	Pickup and delivery	Customer service	Other	Total
Driver and guard wages	(897000* %)	313950	403650	134550	44850	897000
Vehicle operating expense	(308000* %)	200200	30800	0	77000	308000
Vehicle depreciation	(169000* %)	109850	16900	0	42250	169000
Customer representative salaries and expense	(199000* %)	0	0	149250	49750	199000
Office expense	(49500* %)	0	12375	17325	19800	49500
Administrative expense	(378000* %)	0	56700	170100	151200	378000
Total cost		624000	520425	471225	384850	2000500