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Activity level and cost information The level of each activity in the three market segments and the total cost incurred for each activity in 2022 are shown below. Required 1. Compute the August 2022 gross margin percentage for each of Medcare's three market segments. 2. Compute the August 2022 per-unit cost driver rate for each of the five activity areas. 3. Use the activity-based costing (ABC) information to allocate the $308,635 of "other operating costs" to each of the market segments. Compute the operating income (loss) for each market segment. 4. Comment on the results. What new insights are available with the activity-based information? Modcave inc speccalizes in the distribubon of pharmaceutical products. Medcare operates at capacily and has three mam markef segrnerits. (Click the icon to view the segments) Rock Flare, the new controller of Medcare, reported the following data for August 2022. (Cick the icon to vow the data) (i) (Click the icon to view the activbes and relevant infornation.) (Chok the icon to view the activity level and cost informabon) Reguired Required 1. Compute the August 2022 gross magin percentage for each of Medcare's three market segments. 2. Compute the August 2022 per-unit cost enver tate for each of the five activity areas 3. Use the activity based costing (ABC) informison to alocate the $308,635 of "other operaing costs" to each of she market segments Compute the operating incone (loss) for each market segment 4. Comment on the resuits. What new insohts are avalable with the activity-based information? Data table Data table Activity level and cost information The level of each activity in the three market segments and the total cost incurred for each activity in 2022 are shown below. Data table Activities For many years, Medcare has used gross margin percentage [(Revenue - Cost of goods sold) + Revenue] to evaluate the relative profitability of its different groupings of customers (distribution outlets). Flair recently attended a seminar on activity-based costing (ABC) and decides to consider using it at Medcare. Flair meets with all the key managers and many staff members. People generally agree that there are five key activity areas at Medcare. Each customer order consists of one or more line items. A line item represents a single product (such as Extra-Strength Tylenol Tablets). Each product line item is delivered in one or more separate cartons. Each store delivery entails the delivery of one or more cartons of products to a customer. Medcare's staff stacks cartons directly onto display shelves in customers' stores. Currently, there is no additional charge to the customer for shelf stocking, and not all customers use Medcare for this activity. Modcave inc speccalizes in the distribubon of pharmaceutical products. Medcare operates at capacily and has three mam markef segrnerits. (Click the icon to view the segments) Rock Flare, the new controller of Medcare, reported the following data for August 2022. (Cick the icon to vow the data) (i) (Click the icon to view the activbes and relevant infornation.) (Chok the icon to view the activity level and cost informabon) Reguired Required 1. Compute the August 2022 gross magin percentage for each of Medcare's three market segments. 2. Compute the August 2022 per-unit cost enver tate for each of the five activity areas 3. Use the activity based costing (ABC) informison to alocate the $308,635 of "other operaing costs" to each of she market segments Compute the operating incone (loss) for each market segment 4. Comment on the resuits. What new insohts are avalable with the activity-based information? Medcare inc specializes in the distribution of pharmaceutical products. Medcare operates at capacify and has three main market segrnents (Click the icon to view the segments.) Rick Flair, the new controller of Medcare, reported the following data for August 2022 (Click the icon to vew the data) (Chick the icon to view the activities and relevant information.) (Click the icon to view the activity level and cost information.)
