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Cancico Communications has supplied the following data for use in its ABC system: Overhead Costs Wages and salaries $ 295,000 Other overhead costs 163,000 Total

Cancico Communications has supplied the following data for use in its ABC system:

Overhead Costs
Wages and salaries $ 295,000
Other overhead costs 163,000
Total overhead costs $ 458,000

Activity Cost Pool Activity Measure Total Activity
Direct labour support Number of direct labour-hours 12,110 DLHs
Order processing Number of orders 500 orders
Customer support Number of customers 120 customers
Other These costs are not allocated to products or customers NA

Distribution of Resource Consumption across Activity Cost Pools
Direct Labour Support Order Processing Customer Support Other Total
Wages and salaries 15 % 40 % 35 % 10 % 100 %
Other overhead costs 10 % 25 % 25 % 40 % 100 %

During the year, Cancico Communications completed an order for special telephone equipment for a new customer, HurnTel. This customer did not order any other products during the year. Data concerning that order follow:

Selling price $ 216 per unit
Units ordered 180 units
Direct materials $ 194 per unit
Direct labour-hours 0.6 DLH per unit
Direct labour rate $ 24 per DLH

Required:

1. Prepare a report showing the first-stage allocations of overhead costs to the activity cost pools.

2. Compute the activity rates for the activity cost pools. (Round your answers to 2 decimal places.)

3. Prepare a report showing the overhead costs for the order from HurnTel, including customer support costs. (Round your answers to 2 decimal places.)

4. Prepare a report showing the customer margin for HurnTel. (Round your answers to 2 decimal places.)

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