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Grippy Inc. is a small distributor of mechanical pencils. Grippy identifies its three major activities and cost pools as ordering. receiving and storage, and
Grippy Inc. is a small distributor of mechanical pencils. Grippy identifies its three major activities and cost pools as ordering. receiving and storage, and shipping, and it reports the following details for 2016 (Click the icon to view the activity and cost pool details) For 2016, Grippy buys 250,000 pencil packs at an average cost of $3 per pack and sele price of $7 per pack. Assume Grippy has no fixed costs and no inventories Read the requirement Begin by calculating the operating income. Then, calculate the per unit amounts (Round the per unit amounts to the nearest cent) Total $1,750,000 $ Per Unit 7.00 Revenues Costs Data table Purchase cost of pencil packs Ordering costs 750,000 40,000 3.00 Activity Receiving and storage 270,000 Shipping 90.000 1. Placing and paying for orders of pencil packs Number of orders 2. Receiving and storage 1,150,000 3. Shipping of pencil packs to retailers Cost Driver Quantity of Cost Driver Cost per Unit of Cost Driver 400 $100 per order Loads moved 4,500 $60 per load Number of shipments 1,500 $60 per shipment Total costs 600,000 Operating income
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