Below you will find information on Transport Trucking Ltd. With detailed Actions: traceable costs and...

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Question

Accounting

Below you will find information on Transport Trucking Ltd. With detailed Actions: traceable costs and physical flow of driver units:

Actions

Traceable

Costs

Physical Flow of

Driver Units

Account inquiry (hours)

$ 200,000

5,000 hours

Account billing (lines)

140,000

2,000,000 lines

Account verification

(accounts)

75,000

20,000 accounts

Correspondence (letters)

25,000

2,000 letters

The above Actions are used by departments: Mechanics and Advisors as shown below:

DEPARTMENTS

Mechanics

Advisors

Account inquiry (hours)

1,000 hours

2,000 hours

Account billing (lines)

200,000 lines

100,000 lines

Account verification

(accounts)

5,000 accounts

4,000 accounts

Correspondence (letters)

500 letters

800 letters

1. What is the cost per driver unit for the account inquiry activity?

A) $40.00

B) $0.07

C) $3.75

D) $12.50

2. What is the cost per driver unit for the account billing activity?

A) $40.00

B) $0.07

C) $3.75

D) $12.50

3. How much of the account billing cost will be assigned to Department Advisors?

A) $14,000

B) $140,000

C) $7,000

D) None of the above

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