Data tableActivity1. Placing and paying for orders ofpencil packs2. Receiving and storage3. Shipping of pencil packs toretailersCost DriverNumber of ordersLoads movedNumber of shipmentsQuantity of Cost per Unit of CostDriverCost Driver8004,5001,500$100 per order$60 per load$70 per shipment Guppy Inc. is a small distributor of mechanical pencils. Guppy identifiesits three major activities and cost pools as ordering, receivingand storage, and shipping, and it reports the following details for 2019:(Click the icon to view the activity and cost pool details.)RevenuesCosts:Begin by calculating the operating income. Then, calculate the per unit amounts. (Round the per unit amounts to the nearest cent.)Purchase cost of pencil packsOrdering costsReceiving and storageShippingTotal costsOperating incomeTotalCPer UnitFor 2019, Guppy buys 250,000 pencil packs at an average costof $3 per pack and sells them to retailers at an average price of$7 per pack. Assume Guppy has no fixed costs and noinventories.Calculate Guppy's operating income for 2019.

Activity Rate :— It is the rate used to allocate manufacturing overhead cost to cost object under…

Inc. is a small distributor of mechanical pencils. Guppy identifies e major activities and cost pools as ordering, receiving prage, and shipping, and it reports the following details for 2019: lick the icon to view the activity and cost pool details.) by calculating the operating income. Then, calculate the per unit amounts. (Round the per unit amounts to the nearest cent.) Per Unit ues chase cost of pencil packs dering costs ceiving and storage pping otal costs ting income For 2019, Guppy buys 250,000 pencil packs at an average cost of $3 per pack and sells them to retailers at an average price of $7 per pack. Assume Guppy has no fixed costs and no inventories. Calculate Guppy's operating income for 2019. Total

Inc. is a small distributor of mechanical pencils. Guppy identifies e major activities and cost pools as ordering, receiving prage, and shipping, and it reports the following details for 2019: lick the icon to view the activity and cost pool details.) by calculating the operating income. Then, calculate the per unit amounts. (Round the per unit amounts to the nearest cent.) Per Unit ues chase cost of pencil packs dering costs ceiving and storage pping otal costs ting income For 2019, Guppy buys 250,000 pencil packs at an average cost of $3 per pack and sells them to retailers at an average price of $7 per pack. Assume Guppy has no fixed costs and no inventories. Calculate Guppy's operating income for 2019. Total

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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Question

Data table
Activity
1. Placing and paying for orders of
pencil packs
2. Receiving and storage
3. Shipping of pencil packs to
retailers
Cost Driver
Number of orders
Loads moved
Number of shipments
Quantity of Cost per Unit of Cost
Driver
Cost Driver
800
4,500
1,500
$100 per order
$60 per load
$70 per shipment

Guppy Inc. is a small distributor of mechanical pencils. Guppy identifies
its three major activities and cost pools as ordering, receiving
and storage, and shipping, and it reports the following details for 2019:
(Click the icon to view the activity and cost pool details.)
Revenues
Costs:
Begin by calculating the operating income. Then, calculate the per unit amounts. (Round the per unit amounts to the nearest cent.)
Purchase cost of pencil packs
Ordering costs
Receiving and storage
Shipping
Total costs
Operating income
Total
C
Per Unit
For 2019, Guppy buys 250,000 pencil packs at an average cost
of $3 per pack and sells them to retailers at an average price of
$7 per pack. Assume Guppy has no fixed costs and no
inventories.
Calculate Guppy's operating income for 2019.

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