Dideda Company Uses an Activity-Based Costing System with Three Activity

question 75

Multiple Choice

Dideda Company uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity-based costing system:
$\begin{array} { | l | r | } \hline \text { Costs: } & \\\hline \text { Manufacturing overhead } & \$ 360,000 \\\hline \text { Selling and administrative expenses } & \underline { 240,000 } \\\hline \text { Total } & \$ 600,000 \\\hline\end{array}$

$\text { Distribution of Resource Consumption: }$
$\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$ $\quad$$\text { Activity Cost Pools }$$\begin{array} { |l | r | r | r | r | } \hline & \text { Order Size } & \begin{array} { r } \text { Customer } \\\text { Support }\end{array} & \text { Other } & \text { Total } \\\hline \begin{array} { l } \text { Manufacturing } \\\text { overhead }\end{array} & 25 \% & 65 \% & 10 \% & 100 \% \\\hline \begin{array} { l } \text { Selling and } \\\text { administrative } \\\text { expenses }\end{array} & 60 \% & 20 \% & 20 \% & 100 \% \\\hline\end{array}$ The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs. You have been asked to complete the first-stage allocation of costs to the activity cost pools.


-How much cost,in total,would be allocated in the first-stage allocation to the Customer Support activity cost pool?

• A) $120,000.
• B) $255,000.
• C) $282,000.
• D) $390,000.

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Definitions:

Cultural Imperialism

The imposition of one culture's beliefs, practices, and artifacts on another culture through media and consumer products rather than by direct military force.

Economic Strength

The capacity of an economy to produce goods and services, sustain growth, and maintain a strong financial standing.

Material Culture

Refers to the physical objects, resources, and spaces that people use to define their culture. These include buildings, tools, and artwork, representing the tangible or visible aspects of a society.

Technology

The application of scientific knowledge for practical purposes, especially in industry and improvements in tools, machines, techniques, and processes.