Foster Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs and its activity-based costing system:Overhead costs: Wages and salaries$70,000Other expenses 50,000Total$120,000Distribution of resource consumption:Activity Cost Pools?Order SizeCustomer SupportOtherTotalWages and salaries70%20%10%100%Other expenses45%25%30%100%The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs.The amount of activity for the year is as follows:Activity Cost Pool ActivityMaking bouquets40,000bouquetsDelivery1,000deliveriesWhat would be the total overhead cost per bouquet according to the activity-based costing system? In other words,
what would be the overall activity rate for the making bouquets activity cost pool? (Round to the nearest whole cent.)
A. $2.10
B. $1.73
C. $1.35
D. $1.79
Answer: D
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