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Activity-based cost analysis of 20X5 sorting costs (in 000s)
Activity Cost driver Cost pool Total activity
Pre-sort piece $ 4,844 96,180
Sort letters piece 1,362 37,800
Separate regular and express parcels kilogram 6,467 29,190
*Sort regular parcels piece 5,113 53,760
*Sort express parcels piece 3,722 4,620
Expedite parcels hours 2,538 126
Distribute to mail carriers bundle 2,950 5,000
TOTAL SORTING COSTS $ 26,996
*Average weight of parcels is 0.5 kg. Activity-based costing 20X5 units of activity (in 000s)
Activity Letters Express parcel Regular parcel Total
Pre-sort 37,800 4,620 53,760 96,180
Sort letters 37,800 37,800
Separate regular 2,310 26,880 29,190
Sort regular parcels 53,760 53,760
Sort express parcels 4,620 4,620
Expedite parcels 126 126
Distribute to mail carriers 3,000 2,000 5,000
reallocate sorting labour and sorting overhead costs to each of th edepartment using the cativity based costing .
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