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help answer part A and B please with explaination This is a cost allocation problem for a merchandising firm. Since merchandising firms do not have
help answer part A and B please with explaination
This is a cost allocation problem for a merchandising firm. Since merchandising firms do not have overhead, you must allocate "operating costs" instead of "overhead costs." Also, the allocations in this problem are to a department, not to a product or job. Nonetheless, the allocation process is the same. Just follow the three steps used in the lectures: 1. Read the problem and question carefully to determine the cost driver. 2. Compute the "overhead" rate - budgeted operating costs / budgeted driver. 3. Allocate to the specific department - overhead rate X driver for the specific department. Remember that with activity-based costing (Part B), there is more than one driver and more than one rate, and the allocation to a department is the sum of several individual allocations. Each part of the problem is worth five points, and you get six tries per part. Books and Brew (BB) is a large city bookstore that sells books and music CDs, and also has a cafe. Prior to this year, BB used a single-driver system to allocate its operating costs to each of its three product lines, with the number of items sold as the single cost driver. But BB's management was concerned that this allocation system was not providing the best information for making its many pricing decisions. BB's budgeted operating costs for 2021 were as follows: Purchasing department $482,000 Receiving department $432,000 $494,000 Shelf-stocking employee salaries Cashiers and floor employee salaries $146,000 The following is budgeted 2021 information for BB's three product lines: Books CDs Cafe Revenue $3,969,000 $2,555,000 $760,000 Cost of merchandise $2,767,000 $1,849,000 $525,000 Number of purchase orders placed 2,630 2,590 2,030 Number of deliveries received 1,240 1,750 1,750 Hours of shelf stocking time 14,800 13,400 10,300 Number of items sold 123,000 117,000 280,000 REQUIRED (ROUND ALLOCATION RATES TO TWO DECIMAL PLACES.] Part A [6 tries; 5 points] Using BB's traditional single-driver system to allocate its operating costs in 2021, how much would be allocated to CDs? Submit Answer Tries 0/6 Part B [6 tries; 5 points] If BB decided to use an activity-based costing system to allocate its operating costs in 2021, how much would be allocated to the cafe? For cashiers and floor employee salaries, use number of items sold as the cost driver; for the other three cost categories, it should be clear what the appropriate drivers are. Submit Answer Tries 0/6 This is a costale om problemer merchandising the merchandising det have ever you the period of what is the locations in Nis prometa dent, ut product or ju. Nette scation process is the court follow the three been in the lectures L. Read the protein and to carwally to tie the cost driver 2. Compute the red rate-budgeted operating costs / badgeted driver The specific apartment overhead extreme specific department Each part of the problem is worth pain, you get the per part Dont be there to get to contoh Best Western malo gw costo 2021 reasot Phe 42,000 . She Chestore 114.000 The whole 2021 CD 255.000 000 2.50 20.000 5.000 122.000 DAN C Maced water | How It is v thu 16.00 123.000 14100 112.00 17 10,00 20. REQUIRED ROUND MICANON RATES TO TWO DECHERCHE Port All) Wir verwench wollte Porter veten. Det er de ware
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