Question

Stark Corporation has two​ departments, Car Rental and Truck Rental. Central costs may be allocated to the two departments in various ways. Car Rental Truck Rental Number of Vehicles in fleet 840 470 Number of employees 135 65 Sales $ 720 comma 000 $ 400 comma 000 If administrative expense of $ 62 comma 100.00 is allocated on the basis of number of​ employees, the cost per cost driver rate would be​ ________.

Answer 1

310.5 activity rate per employee

Step-by-step explanation:

Number of employees:

135 Car Rental

65 TruckRental

200 total

`(Activity\: Cost)/(Pool)= Activity\:Rate`

We have to distribute the total cost over the cost driver, in this case numebr of employee

62,100/200 = 310.5 activity rate