Assume that OfficeMart places orders more frequently, but everything else remains the same. On your worksheet increase the number of orders from 4 to 10. (Prior to completing this requirement, change all worksheet figures back to their original amounts.)
(a) What is the customer margin under activity-based costing when the number of orders increases to 10?(Enter a loss as a negative amount.)
(b) What is the product margin under the traditional costing system when the number of orders increases to 10? (Enter a loss as a negative amount.)
(c) Which of the following statements are true? (You may select more than one answer. Single click the box with a check mark for correct answers and double click to empty the box for the wrong answers.)
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.