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Hudson Enterprises makes a variety of products that it sells to other businesses. The company's activity- based costing system has four activity cost pools
Hudson Enterprises makes a variety of products that it sells to other businesses. The company's activity- based costing system has four activity cost pools for assigning costs to products and customers. Details concerning thatactivity-based costing system are listed below. Activity Cost Pool Supporting assembly Processing batches Processing orders Serving customers Activity Measure Direct labor-hours (DLHS) Number of batches Number of orders. Number of customers Activity Rate $6.25 per DLH $181.40 per batch $54.00 per order $2,574.00 per customer The cost of serving customers, $2,574.00 per customer, is the cost of serving a customer for one year. Baker Corporation buys only one of the company's products. The details of last year's purchases of this product are listed below: Number of units purchased Number of batches Number of orders Direct labor-hour requirement Selling price Direct materials cost Direct labor cost 900 units 9 batches 4 orders 0.15 DLHS per unit $23.95 per unit $7.00 per unit $2.35 per unit Required: show your work- 14 points a. According to the activity-based costing system, what is the cost of the "Supporting assembly" activity for Baker Corporation for the year? b. According to theactivity-based costing system, what is the cost of the "Processing batches" activity for Baker Corporation for the year? c. According to theactivity-based costing system, what is the cost of the "Processing orders" activity for Baker Corporation for the year? d. According to theactivity-based costing system, what is the cost of the "Servicing customers" activity for Baker Corporation for the year? e. What is the customer margin on sales to Baker Corporation for the year?
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