(Appendix 7A) Jahnel Corporation is conducting a time-driven activity-based costing study in its Tech Support Department. The company has provided the following data to aid in that study:

-On the Customer Cost Analysis report in time-driven activity-based costing,the time-driven activity rate for Routing Calls would be closest to:
A) $5.60 per call routed
B) $14.00 per call routed
C) $0.40 per call routed
D) $3.86 per call routed

Question

(Appendix 7A) Jahnel Corporation is conducting a time-driven activity-based costing study in its Tech Support Department. The company has provided the following data to aid in that study:
  
-On the Customer Cost Analysis report in time-driven activity-based costing,the time-driven activity rate for Routing Calls would be closest to:
A) $5.60 per call routed 
B) $14.00 per call routed 
C) $0.40 per call routed 
D) $3.86 per call routed

Quizplus · Accepted Answer

The time-driven activity rate is calculated by dividing the total cost of the activity by the total time spent on the activity. In this case, the total cost of Routing Calls is $112,000 and the total time spent on the activity is 20,000 minutes. Therefore, the time-driven activity rate is $112,000 / 20,000 minutes = $5.60 per call routed.

(Appendix 7A) Jahnel Corporation Is Conducting a Time-Driven Activity-Based Costing