Fogle Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs and its activity based costing system:

Fogle Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs and its activity based costing system:

 

Overhead costs:
Wages and salaries	$143,000
Other expenses	60,000
Total	$203,000

 

Distribution of resource consumption:
	Activity Cost Pools
	Making Bouquets	Delivery	Other	Total
Wages and salaries	55%	35%	10%	100%
Other expenses	40%	30%	30%	100%

 

The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs.

 

The amount of activity for the year is as follows:

 

Activity Cost Pool	Activity
Making bouquets	58,325 bouquets
Delivery	8,500 deliveries

 

What would be the total overhead cost per delivery according to the activity based costing system? In other words, what would be the overall activity rate for the deliveries activity cost pool?

 

	$7.58
	$8.01
	$8.87
	$6.30

 

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