Hosang Corporation Has Two Operating Divisions--An Atlantic Division and a Pacific

Multiple Choice

Hosang Corporation has two operating divisions--an Atlantic Division and a Pacific Division. The company's Logistics Department services both divisions. The variable costs of the Logistics Department are budgeted at $32 per shipment. The Logistics Department's fixed costs are budgeted at $243,000 for the year. The fixed costs of the Logistics Department are determined based on peak-period demand. How much Logistics Department cost should be charged to the Atlantic Division at the end of the year?

A) $123,450
B) $103,200
C) $135,450
D) $193,500