A Company Using Activity-Based Pricing Marks Up the Direct Cost

question 96

Multiple Choice

A company using activity-based pricing marks up the direct cost of goods by 30% and then adds the cost of the services that are provided.Indirect costs are charged as follows: $8.00 per order placed; $4.00 per separate item ordered; $30.00 per return.A customer places 10 orders with a total direct cost of $3,000, orders 300 separate items, and makes 5 returns.What will the customer be charged?

• A)$3,000
• B)$3,900
• C)$5,330
• D)$5,759

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Definitions:

Scottish Settler

An individual from Scotland who relocates to another country, often in the context of historical migrations.

General Burgoyne's

Refers to British General John Burgoyne, who is best known for his role in the American Revolutionary War, particularly the 1777 Saratoga campaign which ended in a decisive defeat for his forces.

Battle Of Saratoga

A pivotal series of engagements in 1777 during the American Revolutionary War that resulted in a significant American victory over British forces, influencing international support for the American cause.

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The act of giving up or yielding to the control or possession of another party, often in a military context.