First identify the formula used to compute the traditional overhead rate, then compute the rate. Total Annual
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Total Annual Estimated Cost Driver Cost Driver Activity 57,000 Technician hours 95,000 30,000 Number of prescriptions.. 25,000 234,000 Pharmacist hours 26,000 321,000 Cost Pools Pharmacy occupancy costs (utilities, rent, and other costs) Packaging supplies (bottles, bags, and other packaging) Professional training and insurance costs Total pharmacy overhead Total Annual Estimated Cost Data table Technician Hours Number of Prescriptions Pharmacist Hours Customer Order Number 1240 0.5 4 2.0 Customer Order Number 1241 0.5 2 1.5 - X Wolanin Pharmacy, part of a large chain of pharmacies, fills a variety of prescriptions for customers. The complexity of prescriptions filled by Wolanin varies widely; pharmacists can spend between five minutes and six hours on a prescription order. Traditionally, the pharmacy has allocated its overhead based on the number of prescriptions. The pharmacy chain's controller is exploring whether activity-based costing (ABC) may better allocate the pharmacy overhead costs to pharmacy orders. The controller has gathered the following information: (Click the icon to view the expected usage and costs.) The clerk for Wolaninhas gathered the following information regarding two recent pharmacy orders: (Click the icon to view the pharmacy order data.) Requirement 1. What is the traditional overhead rate based on the number of prescriptions? First identify the formula used to compute the traditional overhead rate, then compute the rate. (Round your answer to the nearest cent. Abbreviations used: est. = estimated) = Traditional overhead rate Total Annual Estimated Cost Driver Cost Driver Activity 57,000 Technician hours 95,000 30,000 Number of prescriptions.. 25,000 234,000 Pharmacist hours 26,000 321,000 Cost Pools Pharmacy occupancy costs (utilities, rent, and other costs) Packaging supplies (bottles, bags, and other packaging) Professional training and insurance costs Total pharmacy overhead Total Annual Estimated Cost Data table Technician Hours Number of Prescriptions Pharmacist Hours Customer Order Number 1240 0.5 4 2.0 Customer Order Number 1241 0.5 2 1.5 - X Wolanin Pharmacy, part of a large chain of pharmacies, fills a variety of prescriptions for customers. The complexity of prescriptions filled by Wolanin varies widely; pharmacists can spend between five minutes and six hours on a prescription order. Traditionally, the pharmacy has allocated its overhead based on the number of prescriptions. The pharmacy chain's controller is exploring whether activity-based costing (ABC) may better allocate the pharmacy overhead costs to pharmacy orders. The controller has gathered the following information: (Click the icon to view the expected usage and costs.) The clerk for Wolaninhas gathered the following information regarding two recent pharmacy orders: (Click the icon to view the pharmacy order data.) Requirement 1. What is the traditional overhead rate based on the number of prescriptions? First identify the formula used to compute the traditional overhead rate, then compute the rate. (Round your answer to the nearest cent. Abbreviations used: est. = estimated) = Traditional overhead rate
Expert Answer:
Answer rating: 100% (QA)
Answer To calculate the traditional overhead rate based on the number of prescriptions we can use t... View the full answer
Related Book For
Posted Date:
Students also viewed these accounting questions
-
Wolanin Pharmacy, part of a large chain of pharmacies, fills a variety of prescriptions for customers. The complexity of prescriptions filled by Wolanin varies widely; pharmacists can spend between...
-
In general, the least expensive form of funding for an investment is . . .
-
Source of Variability SS df MS Between Groups 9 Within Groups (Error) Total 117 FL F=
-
Why might a supervisor be motivated to perceive a subordinate's performance as being poor when it really is not?
-
Suppose the one-year interest rate on British pounds is 11 percent, the dollar interest rate is 6 percent, and the current $/ spot rate is $1.80. a. What do you expect the spot rate to be in one...
-
Describe the reasons an MNC might seek an ISO 9000 certification.
-
The year 2000 was not a particularly pleasant year for the managers of Xerox Corporation, or its shareholders. The company's stock price had already fallen in the previous year from $60 per share to...
-
You have just completed the accounts receivable confirmation process in the audit of Danforth Paper Company, a paper supplier to retail shops and commercial users. Following are the data related to...
-
-- FW22 Remaining Time: 00 ch question so you can make use of it on future attempts. Remember to use the answer preview feature when appropriate, and check your syntax care Let The the domain of f is...
-
What is an example of a successful organizational plan in criminal justice and an example of an unsuccessful organizational plan?
-
The following information was obtained for the KJM Co. Assume U.S.GAAP: Cash payments for interest Retirement of common stock Cash payments to suppliers Purchase of land Sale of equipment Payments of...
-
Your lab group will need to collect data from 10-20 people. You will then make a scatterplot and look for correlations. 1. Choose a variable from the list below. Each of them is based on a person's...
-
Create a pseudocode for this algorithm Steps 1. Unlock your phone 2. Find and open your Chipotle app #If you are already signed in, skip step 3 3. sign in 4. Click on "order now" 5. Choose burrito...
-
At the masters programme entry test, two applicants caught Madinas attention; one man who passed the test before Madina, and another right after her. The first applicant was a bit nervous but...
-
What are the potential consequences of habitat fragmentation and loss on gene flow and population genetic structure, and how might these effects vary across different taxa and landscape...
-
Use table 11-2 to solve the problem. Stuart Daniels estimated that he will need $21,000 to set up a small business in 9 years. (a) How much (in $) must Stuart invest now at 8 % interest compounded...
-
Wilsons Auto Repair ended 2011 with Accounts Receivable of $85,000 and a credit balance in Allowance for Uncollectible Accounts balance of $11,000. During 2012, Wilsons Auto Repair had the following...
-
If equity investors contribute $1,000,000 and want a .30 return at time 4, how much do they require at time 4?
-
a. Assume the value of a firm's equity is $1,000 and $800 of .10 debt is substituted for equity. The corporate tax rate is .35. What is the new value of the equity? What total wealth do the...
-
Assume a $800 investment returns $1,000 at time 1 (a .25 return). What is the IRR on $100 of equity if $700 of .08 debt is used as well as equity?
Study smarter with the SolutionInn App