Papenburg Company has the following activities, allocated costs, and allocation bases: Activities...
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Accounting
Papenburg Company has the following activities, allocated costs, and allocation bases:
| Activities | Allocated Costs (SAR) | Allocation Base |
| Account inquiry (hours) | 360,000 | 4,000 hours |
| Account billing (lines) | 140,000 | 28,000 lines |
| Account verification (accounts) | 90,000 | 6,000 accounts |
| Correspondence (letters) | 60,000 | 1,250 letters |
The activities are carried out at two of their regional offices.
| Southwest Office | Northeast Office | |
| Account inquiry (hours) | 100 hours | 200 hours |
| Account billing (lines) | 10,000 lines | 7,000 lines |
| Account verification (accounts) | 1,000 accounts | 600 accounts |
| Correspondence (letters) | 50 letters | 100 letters |
How much of the account verification costs will be assigned to the Southwest Office?
| SAR 7,800 | ||
| SAR 8,200 | ||
| SAR 9,000 | ||
| SAR 10,400 |
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