The Document Creation Center (DCC)for Arlington Corp If DCC Uses a Dual-Rate for Allocating Its Costs,how Much

question 117

Multiple Choice

The Document Creation Center (DCC) for Arlington Corp.provides photocopying and document services for three departments in the Minneapolis office.The following budget has been prepared for the year. $\begin{array}{|l|l|}\hline \text { Available capacity } & 8,000,000 \text { pages } \\\hline \text { Budgeted us age: } & \\\hline \text { Software Development } & 1,600,000 \text { pages } \\\hline \text { Training } & 3,000,000 \text { pages } \\\hline \text { Management } & 2,400,000 \text { pages } \\\hline \text { Cost equation } & \$ 280,000+\$ 0.03 \text { per page } \\\hline\end{array}$ If DCC uses a dual-rate for allocating its costs,how much cost will be allocated to the Software Development Department,assuming the Software Development Department actually made 1,780,000 copies during the year?

• A) $117,400.
• B) $115,700.
• C) $124,600.
• D) $129,376.

---

Definitions:

Activity-based Costing

An accounting method that assigns costs to products or services based on the resources they consume.

Activity-based Costing

A method of accounting where costs are assigned to products or services based on the activities needed for their production.

Activity-based Costing

A costing methodology that assigns overhead and indirect costs to related products and services based on the actual consumption of each activity.

Manufacturing Overhead

All indirect costs associated with the production process, including costs of materials, utilities, and maintenance that are not directly associated with the manufacturing of a specific product.