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Rupert's Appliance Warehouse (RAW) delivers appliances to retailers throughout the city. The firm adds 6...

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Accounting

Rupert's Appliance Warehouse (RAW) delivers appliances to retailers throughout the city. The firm adds 6 percent to the cost of the appliances to cover the delivery cost. The delivery fee is meant to cover the cost of delivery. The finance team at RAW has analyzed the delivery service using activity-based costing methods and identified four activities. Data on these activities follow:
\table[[Activity,Cost Driver,Activity Cost,Cost Driver Volume],[Processing order,Number of orders,$90,000,6,000 orders],[Loading truck,Number of items,120,000,80,000 items],[Delivering order,Number of orders,108,000,6,000 orders],[Billing,Number of invoices,90,000,5,000 invoices],[Total overhead,,,]]
Two of Rupert's customers are McLean Designs and Neveux Appliances. Data for orders and deliveries to these two customers follow:
\table[[,\table[[McLean],[Designs]],\table[[Neveux],[Appliances]]],[Order value (total),$73,000,$83,000
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