Skyline Florists uses an activity-based costing system to compute the cost of making ﬂoral bouquets and delivering the bouquets to its commercial customers. Company personnel who earn $180,000 typically perform both tasks; other ﬁrm-wide overhead is expected to total $70,000.These costs are allocated as follows: Skyline anticipates making 20,000 bouquets and 4,000 deliveries in the upcoming year. The cost of wages and salaries and other overhead that would be charged to each bouquet made is:
A)$7.15.
B)$8.75.
C)$12.50.
D)$13.75.
E)None of the answers is correct.

Question

Skyline Florists uses an activity-based costing system to compute the cost of making ﬂoral bouquets and delivering the bouquets to its commercial customers. Company personnel who earn $180,000 typically perform both tasks; other ﬁrm-wide overhead is expected to total $70,000.These costs are allocated as follows:  Skyline anticipates making 20,000 bouquets and 4,000 deliveries in the upcoming year. The cost of wages and salaries and other overhead that would be charged to each bouquet made is:
A)$7.15. 
B)$8.75. 
C)$12.50. 
D)$13.75. 
E)None of the answers is correct.

Quizplus · Accepted Answer

The Answer of Skyline Florists uses an activity-based costing system to compute the cost of making ﬂoral bouquets and delivering the bouquets to its commercial customers. Company personnel who earn $180,000 typically perform both tasks; other ﬁrm-wide overhead is expected to total $70,000.These costs are allocated as follows:  Skyline anticipates making 20,000 bouquets and 4,000 deliveries in the upcoming year. The cost of wages and salaries and other overhead that would be charged to each bouquet made is:
A)$7.15. 
B)$8.75. 
C)$12.50. 
D)$13.75. 
E)None of the answers is correct.

Skyline Florists Uses an Activity-Based Costing System to Compute the Cost