Byrd Corporation uses an activity-based costing system to pr…
Byrd Corporation uses an activity-based costing system to price products. The company’s Purchasing Department incurs costs of $550,000 per year. Purchasing has determined the three major activities that occur during the year. Activity Allocation Measure Total Cost Issuing purchase orders # of purchase orders $150,000 Reviewing shipments received # of shipments received $175,000 Making phone calls # of phone calls $225,000 During the year, 50,000 phone calls were made in the department; 15,000 purchase orders were issued; and 10,000 shipments were received. Product A required 200 phone calls, 150 receiving reports, and 50 purchase orders. The amount of Purchasing Department cost assigned to Product A is $______________.