Answer the Following Question(s)using the Information Below

question 73

Multiple Choice

Answer the following question(s) using the information below:
At the Todd Company, the cost of the personnel department has always been charged to the various departments based upon the number of employees.Recently, opinions gathered from the department managers indicated that the number of new hires might also be a predictor of personnel costs to be assigned.Total personnel costs are $320,000.
-If the number of new hires is considered the cost driver, what amount of personnel costs will be allocated to Department A?

• A)$24,000
• B)$10,667
• C)$102,400
• D)$40,000
• E)$50,000

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Definitions:

Removal and Restorations Costs

The expenses associated with dismantling and removing an asset, and restoring the site on which it was located.

Development Phase

A stage in the lifecycle of a project or product focused on research, design, and development activities before commercial production begins.

Volatility

A statistical measure of the dispersion of returns for a given security or market index, often used to quantify the risk of a security or portfolio.

Full Cost Method

An accounting method used in the oil and gas industry where all exploration, development, and production costs are capitalized and amortized over the life of reserves.