City General County General $ 2 Compute the activity rate for each activity cost pool. (Round the "Line Item plcking" to 2 decimal places. Omit the "$" sign In your response.) Activity Cost Pool Customer deliveries Manual order processing Electronic order processing Line item picking Activity Rate per delivery $ per manual order per electronic order per line item picked 3. Compute the total activity costs that would be assigned to City General and County General (Round your Intermediate calculations and final answers to 2 decimal places. Omit the "$" sign In your response.) City General County General Total Activity Costs $ $ 4. Compute Med Max's customer margin for City General and County General. (Hint: Do not overlook the $33,000 cost of goods sold that Med Max incurred serving each hospital.) (Loss amount should be Indicated with a minus sign. Round your Intermediate calculations and final answers to 2 decimal places. Omit the "$" sign In your response.) Customer Margin City General County General 66 Med Max gathered the data below for two of the many hospitals that it serves--City General and County General (each hospital purchased medical supplies that had cost Med Max $33,000 to buy from its manufacturers): Activity City General County General 16 29 0 47 Activity Measure Number of deliveries Number of manual orders Number of electronic orders Number of line items picked 14 0 190 250 Required: 1. Compute the total revenue that Med Max would receive from City General and County General. (Omit the "$" sign In your response.) Total Revenue $ City General County General 2. Compute the activity rate for each activity cost pool. (Round the "Line Item plcking" to 2 decimal places. Omit the "$" sign in your response.) Activity Rate $ per delivery 3 Activity Cost Pool Customer deliveries Manual order processing Electronic order processing Line item picking TA 69 per manual order per electronic order per line item picked 69 $ Med Max buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to hundreds of hospitals. Med Max sets its prices for all hospitals by marking up its cost of goods sold to those hospitals by 8%. For example, if a hospital buys supplies from Med Max that had cost Med Max $100 to buy from manufacturers. Med Max would charge the hospital $108 to purchase these supplies. For years. Med Max believed that the 8% markup covered its selling and administrative expenses and provided a reasonable profit. However, in the face of declining profits Med Max decided to implement an activity-based costing system to help improve its understanding of customer profitability. The company broke its selling and administrative expenses into five activities as shown below: Total Cost $ 504.000 Activity Cost Pool Customer deliveries Manual order processing Total Activity 6.000 deliveries 6,000 orders 444,000 Electronic order processing Activity Measure Number of deliveries Number of manual orders Number of electronic orders Number of line items picked NA 252,000 14.000 orders 819.000 420.000 line items Line item picking Other organization-sustaining costs 660,000 Total selling and administrative expenses $2.679.000 Med Max gathered the data below for two of the many hospitals that it serves-City General and County General (each hospital purchased medical supplies that had cost Med Max $33,000 to buy from its manufacturers): Activity Measure Number of deliveries Number of manual orders Number of electronic orders Number of line items nicked Activity City General County General 16 29 0 47 14 0 190 250
