Activity-Based Supplier Costing Clearsound uses Alpha Electronics and La Paz Company to buy two electronic components used in the manufacture of its cell phones Component 125X and Component 3oY. Consider two activities: testing components and reordering components. After the two components are inserted, testing is done to ensure that the two components in the phones are working properly. Reordering occurs because one or both of the components have failed the test and it is necessary to replenish component inventories. Activity cost information and other data needed for supplier costing are as follows: I. Activity Costs Caused by Suppliers (testing failures and reordering as a result) Activity Testing components Reordering components II. Supplier Data Costs $1,200,000o 300,000 Alpha Electronics 30Y $26 120,000 73,400 780 40 La Paz Company 125X 125x $10 Unit purchase price Units purchased Failed tests Number of reorders Required: 15,000 15,000 1,400 60