myaccount Posts: 1, Reputation: 1 New Member   #1 Jan 29, 2012, 02:55 PM

Activity based costing Silicon Optics has supplied the following data for use in its activity-based costing system: Overhead Costs Wages and salaries $ 347,000 Other overhead costs 194,000 Total overhead costs $ 541,000 Activity Cost Pool Activity Measure Total Activity Direct labor support Number of direct labor-hours 9,500 DLHs Order processing Number of orders 550 orders Customer support Number of customers 65 customers Other This is an organization-sustaining activity Not applicable Distribution of Resource Consumption Across Activities Direct Labor Support Order Processing Customer Support Other Total Wages and salaries 10 % 30 % 20 % 40 % 100 % Other overhead costs 25 % 10 % 20 % 45 % 100 % During the year, Silicon Optics completed an order for a special optical switch for a new customer, Indus Telecom. This customer did not order any other products during the year. Data concerning that order follow: Data Concerning the Indus Telecom Order Selling price $ 340 per unit Units ordered 100 units Direct materials $ 268 per unit Direct labor-hours 1 DLH per unit Direct labor rate $ 26 per DLH Required: 1. Prepare a report showing the first-stage allocations of overhead costs to the activity cost pools. (Omit the "$" sign in your response.) Direct Labor Support Order Processing Customer Support Other Totals Wages and salaries $ $ $ $ $ Other overhead costs Total cost $ $ $ $ $ 2. Compute the activity rates for the activity cost pools. (Round your answers to 2 decimal places. Omit the "$" sign in your response.) Activity Cost Pools Activity Rate Direct labor support $ per DLH Order processing $ per order Customer support $ per customer 3. Compute the overhead costs for the order from Indus Telecom, including customer support costs. (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Activity Cost Pool ABC Cost Direct labor support $ Order processing Customer support Total $ 4. Prepare a report showing the customer margin for Indus Telecom. (Input all amounts as positive values except losses which should be indicated by a minus sign. Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Indus Telecom Customer Margin—ABC Analysis $ Costs: $ Customer margin

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