2. Assume that OfficeMart places orders more frequently, but everything else remains the same. On your worksheet increase the number of orders from 4 to 13.

a) What is the customer margin under activity-based costing when the number of orders increases to 13?

(b) What is the product margin under the traditional costing system when the number of orders increases to 13? (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 the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.)

D C E 1 Chapter 7: Applying Excel 2 3 Data Manufacturing overhead $ 4 500,000 300,000 5 Selling and administrative overhead 6 Assembling Units Processing Orders Supporting Customers 7 Other Manufacturing overhead 35% 5% 10% 50% 9 Selling and administrative overhead 10% 45% 25% 20% Total activity 10 250 100 1,000 units orders 11 customers 12 OfficeMart orders: 13 14 Customers 1 customer 15 Orders 13 orders 16 Number of filing cabinets ordered in total 80 units 17 Selling price $ 595 18 Direct materials 180 19 Direct labor 50 | ? 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 fa 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