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Dickerson Corporation Had the Following Activities, Traceable Costs, and Physical

Question 41

Multiple Choice

Dickerson Corporation had the following activities, traceable costs, and physical flow of driver units:  Traceable  Physical Flow of  Activities  Costs  Driver Units  Acc ount inquiry (hours)  $10,000500 hours  Acc ount billing (lines)  5,600200,000 lines  Account verification (accounts)  3,0002,000 accounts  Correspondence (letters)  1,000200 letters \begin{array}{llll}& \text { Traceable } & \text { Physical Flow of } \\\text { Activities } & \text { Costs } & \text { Driver Units }\\\text { Acc ount inquiry (hours) } & \$ 10,000 & 500 \text { hours } \\\text { Acc ount billing (lines) } & 5,600 & 200,000 \text { lines } \\\text { Account verification (accounts) } & 3,000 & 2,000 \text { accounts } \\\text { Correspondence (letters) } & 1,000 & 200 \text { letters }\end{array} The above activities are used by departments A and B as follows:  A  B  Acc ount inquiry (hours)  50 hours 80 hours  Account billing (lines)  25,000 lines 20,000 lines  Account verification (accounts)  200 contracts 100 contracts  Correspondence (letters)  20 letters 100 letters \begin{array} { l l l } & \underline { \text { A } } & \underline { \text { B } } \\\text { Acc ount inquiry (hours) } & 50 \text { hours } & 80 \text { hours } \\\text { Account billing (lines) } & 25,000 \text { lines } & 20,000 \text { lines } \\\text { Account verification (accounts) } & 200 \text { contracts } & 100 \text { contracts } \\\text { Correspondence (letters) } & 20 \text { letters } & 100 \text { letters }\end{array} The cost per driver unit for the account inquiry activity is:


A) $5.00
B) $20.00
C) $0.028
D) $1.50

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