Reference no: EM132560482
Colavito Airlines' ground handling department has assigned all overhead costs into seven activity cost pools. The budgeted amounts and the associated cost drivers for these cost pools are as follows:
Activity Budgeted Budgeted Level
Cost Pool Costs Cost Driver for Cost Driver
Loading and unloading cargo $250,000 Pounds of cargo 2,000,000 lbs.
Directing planes to and from gates 110,000 Directing distance 5,500 miles
Loading and unloading baggage 300,000 Bags loaded & unloaded 100,000 bags
Communicating with pilots 80,000 Communication time 2,000 hours
Fueling planes 450,000 Fueling time 10,000 hours
Deicing planes 75,000 Deicing time 1,000 hours
Locating mishandled bags 200,000 Number of inquiries 5,000 inquiries
Total $1,465,000
Flight #1025 has just been completed with the following cost driver information available:
Pounds of cargo 37,000
Directing distance (miles) 2.3
Bags loaded & unloaded 250
Communication hours 1.4
Fueling hours 3.7
Deicing hours 0.3
Number of inquiries 4
Question 1: Compute the total overhead cost assigned to Flight #1025, using an overall overhead rate based on number of bags loaded and unloaded
Question 2: Compute the total overhead cost assigned to Flight #1025, using activity-based costing
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