Reference no: EM133137236

Question - ABC Co. has a central copying facility. The copying facility has only two users, the Marketing Department and the Operations Department. The following data apply to the coming budget year:

Budgeted costs of operating the copying facility for 400,000 to 600,000 copies:

Fixed costs per year $120,000

Variable costs 4 cents (.04) per copy

Budgeted long-run usage in copies per year:

Marketing Department 160,000 copies

Operations Department 340,000 copies

Budgeted amounts are used to calculate the allocation rates.

Actual usage for the year by the Marketing Department was 110,000 copies and by the Operations Department was 370,000 copies. ABC Co. uses a dual rate system for allocating support costs.

Using the dual-rate cost allocation method, what is the amount of copying facility variable costs that will be allocated to the Operations Department?

Using the dual-rate cost allocation method, what is the allocation rate for fixed costs? (meaning what amount of fixed costs will be allocated per unit of the cost driver?

Using the dual-rate cost-allocation method, what is the total amount of copying facility costs that will be allocated to the Marketing Department?