Wanda Florists Uses an Activity-Based Costing System to Compute the Cost

Multiple Choice

Wanda Florists uses an activity-based costing system to compute the cost of making floral bouquets and delivering the bouquets to its commercial customers. Company personnel who earn $90,000 typically perform both tasks; other firm-wide overhead is expected to total $50,000. These costs are allocated as follows: $\begin{array}{llll}&\text { Bouquet}\\&\text { Production}&\text { Delivery}&\text { Other} \\\hline\text { Wages and }\\\text { Salaries } & 40 \% & 50 \% & 10 \% \\\text { Other overhead } & 60 \% & 25 \% & 15 \%\end{array}$ Wanda anticipates making 30,000 bouquets and 6,000 deliveries in the upcoming year. The cost of wages and salaries and other overhead that would be charged to each bouquet made is:

A) $2.20.
B) $3.89.
C) $4.67.
D) $5.56.
E) $18.33.