Rach & Johnson Is an Advertising Agency

question 77

Multiple Choice

Rach & Johnson is an advertising agency.The firm uses an activity-based costing system to allocate overhead costs to its services.Information about the firm's activity cost pool rates follows:

Smythe Company is a client of Rach & Johnson.Recently,8 administrative assistant hours,2 new ad campaigns,and 6 meeting hours were incurred for the Smythe Company account.
Using the activity-based costing system,how much overhead cost would be allocated to the Smythe Company account?

• A)$233
• B)$508
• C)$850
• D)$3,912

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Definitions:

Business Combination

The process of merging two or more companies into one entity, often to expand market share or integrate complementary assets.

Corporate Constituency

The various groups and individuals that a corporation interacts with and has obligations toward, including shareholders, employees, customers, and the community.

Stakeholder Laws

Regulations aimed at protecting the interests of all parties affected by a company's operations, not just its shareholders.

Staggered Terms

An arrangement where members of a governing body are elected at different times, so not all positions are up for election simultaneously.