Activity Availability, Capacity Used, Unused Capacity

Corazon Manufacturing Company has a purchasing department staffed by five purchasing agents. Each agent is paid $$30,000$ per year and is able to process $3,000$ purchase orders. Last year, $13,350$ purchase orders were processed by the five agents.

Required:

Calculate the activity rate per purchase order.

$ $$ per purchase order

Calculate, in terms of purchase orders, the:

a$.$ Total activity availability $$ purchase orders

b$.$ Unused capacity $$ purchase orders

Calculate the dollar cost of:

a$.$ Total activity availability $$ $ $150,000$

b$.$ Unused capacity $

Express total activity availability in terms of activity capacity used and unused capacity. Express total activity availability in terms of activity capacity used and unused capacity.

Purchase orders

Total activity availability

Activity capacity used

Unused capacity

$$

$$

$$

Dollars cost

Total activity availability

Activity capacity used

Unused capacity

$ $$ $ $+$$

$5.$ What if one of the purchasing agents agreed to work half time for $$15,000?$

a$.$ How many purchase orders could be processed by four and a half purchasing agents?

$$ purchase orders

b$.$ What would unused capacity be in purchase orders?

$$ purchase orders

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$1$&$2.$ Activity availability $=$ Activity output $+$ Unused capacity

Cost of activity supplied $=$ Cost of activity used $+$ Cost of unused activity

$3.$ Cost of activity supplied $=$ Cost of activity used $+$ Cost of unused activity

$4.$ Activity availability $=$ Activity output $+$ Unused capacity

Cost of activity supplied $=$ Cost of activity used $+$ Cost of unused activity

$5.$ Activity availability $=$ Activity output $+$ Unused capacity

See Cornerstone $3\mathrm{.}2$

Corazon Manufacturing Company has a purchasing department staffed by five purchasing agents. Each agent is paid $$30,000$ per year and is able to process $3,000$ purchase orders. Last year, $13,350$ purchase orders were processed by the five agents.

Required:

Calculate the activity rate per purchase order.

$ $$ per purchase order

Calculate, in terms of purchase orders, the:

a$.$ Total activity availability $$ purchase orders

b$.$ Unused capacity $$ purchase orders

Calculate the dollar cost of:

a$.$ Total activity availability $ $$

b$.$ Unused capacity $

Express total activity availability in terms of activity capacity used and unused capacity. Express total activity availability in terms of activity capacity used and unused capacity.

Purchase orders

Total activity availability

Activity capacity used

Unused capacity

$$

$$

$$

Dollars cost

Total activity availability

Activity capacity used

Unused capacity

$$

What if one of the purchasing agents agreed to work