John Gordan Company had the following activities, traceable costs, and physical flow of driver units:
The above activities are used by departments A and B as follows:

-How much of the account inquiry cost will be assigned to Department A?
A) $40,000
B) $200,000
C) $80,000
D) None of the above

Question

John Gordan Company had the following activities, traceable costs, and physical flow of driver units:
  The above activities are used by departments A and B as follows:
 
-How much of the account inquiry cost will be assigned to Department A?
A) $40,000 
B) $200,000 
C) $80,000 
D) None of the above

Quizplus · Accepted Answer

The account inquiry cost is a variable cost that is assigned to departments based on the number of inquiries they make. Department A made 20% of the total inquiries, so it will be assigned 20% of the total account inquiry cost, which is $40,000.

John Gordan Company Had the Following Activities, Traceable Costs, and Physical