Eschbach Company Is a Wholesale Distributor That Uses Activity-Based Costing

question 5

Multiple Choice

Eschbach Company is a wholesale distributor that uses activity-based costing for all of its overhead costs. The company has provided the following data concerning its annual overhead costs and its activity based costing system: The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs.
The amount of activity for the year is as follows:
-To the nearest whole dollar, how much wages and salaries cost would be allocated to a customer who made 6 orders in a year?

• A) $2,739
• B) $3,287
• C) $4,382
• D) $2,191

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Definitions:

Automated System

A system that operates or controls a process through the use of advanced technologies, reducing or eliminating the need for human intervention.

Productivity Obstacles

Factors or conditions that hinder or reduce the efficiency and effectiveness of production or work processes.

Unclear Objectives

refers to goals or aims that are not well-defined, making it difficult to achieve targeted outcomes or measure success.

Priorities

The arrangement or ranking of tasks and activities according to their importance or urgency.