Marvin's Kitchen Supply delivers restaurant supplies throughout the city. The firm adds 10 percent to the cost of the supplies to coverthe delivery cost. The delivery fee is meant to cover the cost of delivery. A consultant has analyzed the delivery service using activity-based costing methods and identified four activities. Data on these activities follow.三Cost Driver VolumeActivityProcessing orderLoading truckDelivering merchandiseProcessing invoiceCost$ 60,000266,00072,000Driver Volume4,000 orders140,000 items4,000 orders3,000 invoicesCost DriverNumber of ordersNumber of itemsNumber of ordersNumber of invoices54,000Total overhead$452,000Two of Marvin's customers are City Diner and Le Chien Chaud. Data for orders and deliveries to these two customers follow.City Diner$77,000Le Chien ChaudOrder value$87,000Number of orders57190Number of itemsNumber of invoices4502,30011230Required:a. What would the delivery charge for each customer be under the current policy of 10 percent of order value?b. Calculate the cost of each activity for both restaurants to determine the total activity-based costing estimate of the cost of delivering

a) Calculation of delivery charges is as follows: Resultant table:

Marvin's Kitchen Supply delivers restaurant supplies throughout the city. The firm adds 10 percent to the cost of the supplies to cover the delivery cost. The delivery fee is meant to cover the cost of delivery. A consultant has analyzed the delivery service using activity- based costing methods and identified four activities. Data on these activities follow. Cost Driver Volume Driver Volume Activity Processing order Loading truck Delivering merchandise Processing invoice Cost Driver Cost $ 60,000 266,000 72,000 54,000 Number of orders 4,000 orders 140,000 items 4,000 orders 3,000 invoices Number of items Number of orders Number of invoices Total overhead $452,000 Two of Marvin's customers are City Diner and Le Chien Chaud. Data for orders and deliveries to these two customers follow. City Diner Le Chien Chaud $77,000 Order value Number of orders Number of items $87,000 57 190 2,300 230 450 Number of invoices 11 Required: a. What would the delivery charge for each customer be under the current policy of 10 percent of order value? b. Calculate the cost of each activity for both restaurants to determine the total activity-based costing estimate of the cost of delivering

Marvin's Kitchen Supply delivers restaurant supplies throughout the city. The firm adds 10 percent to the cost of the supplies to cover the delivery cost. The delivery fee is meant to cover the cost of delivery. A consultant has analyzed the delivery service using activity- based costing methods and identified four activities. Data on these activities follow. Cost Driver Volume Driver Volume Activity Processing order Loading truck Delivering merchandise Processing invoice Cost Driver Cost $ 60,000 266,000 72,000 54,000 Number of orders 4,000 orders 140,000 items 4,000 orders 3,000 invoices Number of items Number of orders Number of invoices Total overhead $452,000 Two of Marvin's customers are City Diner and Le Chien Chaud. Data for orders and deliveries to these two customers follow. City Diner Le Chien Chaud $77,000 Order value Number of orders Number of items $87,000 57 190 2,300 230 450 Number of invoices 11 Required: a. What would the delivery charge for each customer be under the current policy of 10 percent of order value? b. Calculate the cost of each activity for both restaurants to determine the total activity-based costing estimate of the cost of delivering

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Colby Company makes cases for cell phones of all sizes and types for sale through specialty retailers. The company makes a standard model for the most recent iPhone as well as a deluxe model. Management has designed an ABC system with the following activity cost pools and activity rates for these models: Activity Rates Activity Cost Pool Supporting manufacturing $2 per direct labour-hour $27 per order Order processing Customer service. $68 per customer Management would like an analysis of the profitability of a particular customer, Cell City, which has ordered the following products over the last 12 months: Standard Model Deluxe Model 95 Number of cases 270 Number of orders Direct labour-hours per case. 5 0.25 47 2 0.40 67 Selling price per case $ $ $ 27 Direct materials cost per case $ 24 The company's direct labour rate is $28 per hour. Required: Using the company's ABC system, compute the customer margin of Cell City. Customer margin
Sterling Hotel uses activity-based costing to determine the cost of servicing customers. There are three activity pools: guest check-in, room cleaning, and meal service. The activity rates associated with each activity pool are $8.10 per guest check-in, $24.00 per room cleaning, and $4.00 per served meal (not including food). Tara Stone visited the hotel for a 4-night stay. Tara had 5 meals in the hotel during the visit. Determine the total activity-based cost for Stone's visit during the month. Round your answer to the nearest cent.$fill in the blank 1
Woodstock Binding has two service departments, IT (Information Technology) and HR (Human Resources), and two operating departments, Publishing and Binding. Management has decided to allocate IT costs on the basis of IT Tickets (issued with each IT request) in each department and HR costs on the basis of employees in each department. The following data appear in the company records for the current period: IT tickets Employees Department direct costs From: Service department costs IT HR Total IT $ 0 16 $ 152,000 Required: Allocate the service department costs using the reciprocal method. (Matrix algebra is not required because there are only two service departments.) Note: Amounts to be deducted should be indicated by a minus sign. Do not round intermediate calculations. HR 1,525 0 $ 247,950 152,000 Answer is not complete. Cost Allocation To: IT HR 152,000 $ 247,950 Publishing 2,440 24 $ 431,000 $ 247,950 Publishing $ Binding 2,135 40 $ 392,500 0 Binding 0
Frederick Company has two service departments (Cafeteria Services & Maintenance). Frederick has two production departments (Assembly Department & Packaging Department.) Frederick uses a step allocation method where Cafeteria Services is allocated to all departments and Maintenance Services is allocated to the production departments. All allocations are based on total employees. Cafeteria Services has costs of $195,000 and Maintenance has costs of $255,000 before any allocations. What amount of Maintenance total cost is allocated to the Packaging Department? Employees are: Cafeteria Services= 3 Maintenance=5 Assembly Department =8 Packaging Department =7 Provide correct answer.
2. Sunshine Company sells custom made surf boards in California. The finance manager has supplied the following data from its activity-based costing system: Overhead Costs Staff Salaries $500,000 Selling and administration overheads 200,000 Total Overhead Costs $700,000 Activity Cost Pool Product design Order Processing Customer Support Activity Measure Number of new designs Number of Customer orders Number of Customers Organization sustaining activity Total Activity for the Year 500 new designs 700 orders 400 customers Not applicable Others Distribution of Resource Consumption across Activities Product Order Customer Other Total Design Processing Support Staff Salaries 40% 30% 20% 10% 100% Selling and 30% 10% 20% 40% 100% administration overheads During the year Sunshine Company completed three individual orders for a new customer, Tarpaper Inc. Two different designs of surfboards were prepared for and sold to this new customer - Orange Tangerine and Blue Waves. Data concerning the…
i post these que. second time please provide working
Using the sequential method, Pone Hill Company allocates Janitorial Department costs based on square footage serviced. It allocates Cafeteria Department costs based on the number of employees served. It has determined to allocate Janitorial costs before Cafeteria costs. It has the following information about its two service departments and two production departments, Cutting and Assembly: Number of Employees 20 10 60 20 Costs Janitorial Department $450,000 Cafeteria Department 200,000 Cutting Department 1,500,000 Assembly Department 3,000,000 Square Feet 100 10,000 2,000 8,000 The percentage (proportional) usage of the Janitorial Department by the Cutting Department is Oa. 20% Ob. 9.9% Oc. 80% Od. 10%
Alpesh
Skyline Florists uses an activity-based costing system to compute the cost of making floral bouquets and delivering the bouquets to its commercial customers. Company personnel who earn $220,000 typically perform both tasks; other firm-wide overhead is expected to total $80,000. These costs are allocated as follows: Bouquet Production Delivery Other Wages and salaries 70 % 20 % 10 % Other overhead 50 % 30 % 20 % Skyline anticipates making 20,000 bouquets and 5,000 deliveries in the upcoming year.What is the cost of wages and salaries and other overhead that would be charged to each bouquet made?
Please help thank you !
narubhai
Please help me. Thankyou