A bakery makes very elaborate wedding cakes to order. The company has an activity- based costing system with three activity cost pools. The activity rate for the size-related activity cost pool is $0.98 per guest. (The greater the number of guests, the larger the cake.) The activity rate for the complexity-related cost pool is $38.95 per tier. (Cakes with more tiers are more complex.) Finally, the activity rate for the order-related activity cost pool is $8245 per order. (Each wedding involves one order for a cake.) The activity rates include the costs of raw ingredients such as flour, sugar, eggs, and shortening. The activity rates do not include the costs of purchased decorations such as miniature statues and wedding bells, which are accounted for separately. Data concerning two recent orders appear below: Smith Jones Wedding 75 Wedding 206 Number of reception guests Number of tiers on the cake 12 Cost of purchased decorations for cake $18.75 $77.65 Assuming that the company charges $885.33 for the Jones wedding cake, what would be the overall margin on the order? Multiple Cholce $55.95 $127.81 $829.38 $134.14

A bakery makes very elaborate wedding cakes to order. The company has an activity- based costing system with three activity cost pools. The activity rate for the size-related activity cost pool is $0.98 per guest. (The greater the number of guests, the larger the cake.) The activity rate for the complexity-related cost pool is $38.95 per tier. (Cakes with more tiers are more complex.) Finally, the activity rate for the order-related activity cost pool is $8245 per order. (Each wedding involves one order for a cake.) The activity rates include the costs of raw ingredients such as flour, sugar, eggs, and shortening. The activity rates do not include the costs of purchased decorations such as miniature statues and wedding bells, which are accounted for separately. Data concerning two recent orders appear below: Smith Jones Wedding 75 Wedding 206 Number of reception guests Number of tiers on the cake 12 Cost of purchased decorations for cake $18.75 $77.65 Assuming that the company charges $885.33 for the Jones wedding cake, what would be the overall margin on the order? Multiple Cholce $55.95 $127.81 $829.38 $134.14

Name: A bakery makes very elaborate wedding cakes to order. The company has
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Description: A bakery makes very elaborate wedding cakes to order. The company has an activity-based costing system with three activity cost pools. The activity rate for the size-relatedactivity cost pool is $0.98 per guest. (The greater the number of guests, th

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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