Last Year, Tevia Inc

Multiple Choice

Last year, Tevia Inc. shipped 6,000,000 kg of goods to customers at a cost of $4,800,000. Suppose an individual customer orders 40,000 kg and produces $400,000 of revenue. (The total revenue is $40 million.) What amount of shipping cost would be assigned to the customer when using activity-based costing?

A) $4,000
B) $8,000
C) $32,000
D) $40,000