Leaper Corporation Uses an Activity-Based Costing System with the Following

question 123

Multiple Choice

Leaper Corporation uses an activity-based costing system with the following three activity cost pools: The Other activity cost pool is used to accumulate costs of idle capacity and organization-sustaining costs.
The company has provided the following data concerning its costs:
The distribution of resource consumption across activity cost pools is given below: The activity rate for the Order Processing activity cost pool is closest to:

• A) $1,485 per order
• B) $1,540 per order
• C) $1,465 per order
• D) $1,320 per order

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Definitions:

Marginal Cost

The additional cost incurred from producing one more unit of a product or service.

Marginal Benefit

The boost in satisfaction or utility experienced upon consuming one more unit of a particular good or service.

Hotel Manager

A person responsible for the daily management of a hotel and its staff, focusing on aspects such as operations, financials, and customer service.

Rational Decisionmaker

An individual or entity that makes decisions by systematically evaluating available information and outcomes to choose the best possible option.