Mesa Telcom Has Three Divisions,commercial,retail,and Consumer,that Share the Common Costs

question 18

Multiple Choice

Mesa Telcom has three divisions,commercial,retail,and consumer,that share the common costs of the company's computer server network.The annual common costs are $2,400,000.You have been provided with the following information for the upcoming year:
$$\begin{array} { | l | r | r | } \hline & \text { Connections } & \begin{array} { r } \text { Time on } \\\text { Network (hous) }\end{array} \\\hline \text { Commercial } & 60,000 & 120,000 \\\hline \text { Retail } & 80,000 & 150,000 \\\hline \text { Consumer } & 100,000 & 330,000 \\\hline\end{array}$$ What is the allocation rate for the upcoming year,assuming Mesa Telcom uses the single-rate method and allocates common costs based on the time on the network?

• A) $20.00.
• B) $16.00.
• C) $4.00.
• D) $2.86.

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Definitions:

Porosity

The measure of void spaces in a material, expressed as a percentage of the volume of voids over the total volume, indicating how much fluid a rock can hold.

Groundwater Flowing

The movement of water beneath the Earth's surface through soil and rock formations.

Subsurface Material

Material (such as rocks, soil, and sediment) found beneath the surface layer of the Earth, important in geotechnical engineering and environmental studies.

Permeability

A measure of how easily fluids can flow through a porous rock or material.