Multiple Choice
International Gems sells fine jewelry 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.International 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.The final cost pool is used for general operations of the department and the cost driver is the number of orders.Information about the activities is summarized below: 
During the period, the Southern sales office generated 240 orders for a total of 3,560 items, which were shipped in 1,200 boxes.What amount of shipping department costs should be allocated to these sales?
A) $9,480
B) $5,040
C) $14,200
D) $18,328
E) None of the answer choices is correct.
Correct Answer:
Verified
Correct Answer:
Verified
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