If Pharmax uses a single-driver system to allocate its support costs, with number of deliveries as the single driver, how much would be allocated to its General Supermarket customers?
Pharmax Distributors specializes in the distribution of pharmaceutical products at the retail level. Pharmax’s customer base is comprised of three main retail groups: general supermarket chains, large drugstore chains, and small, single-store "Ma& Pa" pharmacies. To evaluate the relative profitability of each customer group, Pharmax plans to use an allocation system that recognizes the relative demands that these groups place on the company’s resources. Parmax’s chief accountantexamined the firm’s support costs and activities and collected the following data for a typical operating period:Support ActivityBudgeted CostTotal Cost DriverOrder processing$80,0002,120 customer ordersLine item processing$57,00023,710 line itemsStore deliveries$78,0001,490 deliveriesCarton handling$70,00072,800 cartons shippedShe also gathered the following data for a typical operating period:General SupermarketDrugstore ChainsMa & PaCustomer orders1303901,600Line items1,8204,29017,600Deliveries1002901,100Cartons shipped28,000026,10018,700