(a) What is the customer margin under activity-based costing when the number of orders increases to 11? (Enter a loss as a negative amount.)Customer margin under activity-based costing [ ]I got $7,640 but it was not correct :( (b) What is the product margin under the traditional costing system when the number of orders increases to 11? (Enter a loss as a negative amount.) Product margin under the traditional costing system[ ]I got $(21,600) but it was not correct. :((c) Which of the following statements are true? (You may select more than one answer.) check all that applyIf a customer orders more frequently, but orders the same total number of units over the course of a year, the customer margin under activity based costing will decrease.If a customer orders more frequently, but orders the same total number of units over the course of a year, the product margin under a traditional costing system will decrease.If a customer orders more frequently, but orders the same total number of units over the course of a year, the customer margin under activity based costing will be unaffected.If a customer orders more frequently, but orders the same total number of units over the course of a year, the product margin under a traditional costing system will be unaffected. 2. Assume that OfficeMart places orders more frequently, but everything else remains the same. On your worksheet increase thenumber of orders from 4 to 11. (Prior to completing this requirement, change all worksheet figures back to their original amounts.)AВEChapter 7: Applying Excel3Data4Manufacturing overhead500,0005Selling and administrative overhead300,0006.AssemblingUnitsProcessingSupportingCustomers7OtherOrders8Manufacturing overhead50%35%5%10%9.Selling and administrative overhead10%45%25%20%10Total activity1,00025010011unitsorderscustomers1213OfficeMart orders:14Customers1customer15Orders11orders16Number of filing cabinets ordered in total80units17 Selling price$59518Direct materials2$18019Direct labor50 1 Chapter 7: Applying Excel23 Data4 Manufacturing overhead5 Selling and administrative overhead$500,000$300,0006AssemblingProcessingSupporting7UnitsOrdersCustomersOther8 Manufacturing overhead9 Selling and administrative overhead10 Total activity50%35%5%10%10%45%25%20%1,00025010011unitsorderscustomers1213 OfficeMart orders14 Customers15 Orders16 Number of filing cabinets ordered in total17 Selling price18 Direct materials1 customer4 orders160 units$595$180$5019 Direct labor2021 Enter a formula into each of the cells marked with a ? below22 Review Problem: Activity-Based Costing2324 Perform the first stage allocationsAssembling Processing SupportingOrders2$Total2$25UnitsCustomersOther##HHHH $ 50,000$ 250,00030,000$ 280,000175,00026 Manufacturing overhead27 Selling and administrative overhead28 Total cost500,00075,000$ 100.000135,00060,000300,0002$310,000$ 110.000800,0002930 Compute the activity rates31 Activity Cost Pools32 Assembling units33 Processing orders34 Supporting customersActivity Rate$280 per unit$1,240 per order$1,000 per customerTotal CostTotal Activity$ 280.000$ 310,000$ 100,0001,000 units250 orders100 customers3536 Compute the overhead cost attributable to the OfficeMart orders37 Activity Cost Pools38 Assembling units39 Processing orders40 Supporting customersАВС CostActivity Rate$280 per unit$1,240 per order$1,000 per customerActivity$44,800$4,960160 units4 orders1 customer$1,0004142 Determine the customer margin for the OfficeMart orders under Activity-Based Costing43 Sales$95,20044 Costs:45Direct materials$28,80046Direct labor8,00047Unit-related overhead44,80048Order-related overhead4,96049Customer-related overhead1,00087,56050 Customer margin7.6405152 Determine the product margin for the OfficeMart orders under a traditional cost system53 Manufacturing overhead54 Total activity$500,0001,000 units55 Manufacturing overhead per unit$500 per unit5657 Sales58 Costs:$95,20059Direct materials$28,80060Direct labor8,00061Manufacturing overhead62 Traditional costing product margin80,000116,800$(21,600)63

In the given question Office Mart Order consists of following Customers 1 Customer Orders 11…

a) What is the customer margin under activity-based costing when the number of orders increases to 11? (Enter a loss as a negative amount.) Customer margin under activity-based costing [ ] I got $7,640 but it was not correct :( (b) What is the product margin under the traditional costing system when the number of orders increases to 11? (Enter a loss as a negative amount.) Product margin under the traditional costing system [ ] I got $(21,600) but it was not correct. :( (c) Which of the following statements are true? (You may select more than one answer.) check all that apply If a customer orders more frequently, but orders the same total number of units over the course of a year, the customer margin under activity based costing will decrease. If a customer orders more frequently, but orders the same total number of units over the course of a year, the product margin under a traditional costing system will decrease. If a customer orders more frequently, but orders the same total number of units over the course of a year, the customer margin under activity based costing will be unaffected. If a customer orders more frequently, but orders the same total number of units over the course of a year, the product margin under a traditional costing system will be unaffected.

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q