29 Jul RITZ COMPANY SELLS FINE COLLECTIBLE STATUES
pool Ritz Company sells fine collectible statues and has implemented activity-based costing. Costs in the shipping department have been divided into three cost pools. The first cost pool contains costs that are related to packaging and shipping and Rand has determined that the number of boxes shipped is an appropriate cost driver for these costs. The second cost pool is made up of costs related to the final inspection of each item before it is shipped and the cost driver for this pool is the number of individual items that are inspected and shipped. The final cost pool is used for general operations and supervision of the department and the cost driver is the number of shipments. Information about the department is summarized below:Cost PoolTotal CostsCost DriverAnnual ActivityPackaging and shipping$168,500Number of boxes shipped21,400 boxesFinal inspection$199,500Number of individual items shipped98,500 itemsGeneral operations and supervision$84,500Number of orders9,500 ordersDuring the period, the Far East sales office generated 669 orders for a total of 6,010 items. These orders were shipped in 1,385 boxes. What amount of shipping department costs should be allocated to these sales?
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