Question

 Mayeux Corporation uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity-based costing system: 

Costs:

 Wages and salaries   $ 320,000

 Depreciation   160,000

 Utilities   240,000

 Total  $720,000

 

Distribution of resource consumption: 

Activity Cost Pools 

 

How much cost, in total, would be allocated in the first-stage allocation to the Setting Up activity cost pool?

A) $360,000 B) $336,000 C) $288,000 D) $348,000

Answer 1

Calculate setting up activity cost pool under first stage allocation :

	Setting up
Wages and salaries	128000
Depreciation	88000
Utilities	120000
Total	336000

so answer is b) $336,000