Assume a service company has implemented an activitybased costing system with five activities as shown below:
Activity Cost Pool Activity Measure Total Cost Total Activity
Customer deliveries Number of deliveries $ deliveries
Manual order processing Number of manual orders $ manual orders
Electronic order processing Number of electronic orders $ electronic orders
Line item picking Number of line items picked $ line items
Other organizationsustaining costs None $
The company serves numerous customers, two of which include Hospital A and Hospital B The activity demands pertaining to these two customers are as follows:
Activity Measure Activity
Hospital A Hospital B
Number of deliveries
Number of manual orders
Number of electronic orders
Number of line items picked
How much total activity cost should be assigned to Hospital B for internal management purposes?
Multiple Choice
$
$
$
$
