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I know the correct answers, but I don't understand how to calculate them. 20. B 21. A 22. C Use this data to respond to
I know the correct answers, but I don't understand how to calculate them.
20. B
21. A
22. C
Use this data to respond to questions 14 through 22. CNS Company has three major customers. Customer related costs and applicable cost drivers are as follows: Activity Cost driver Amount Activity Level Processing orders Purchase orders $120,000 2,000 Sales visits Visits 48,000 80 Billing Invoices 36,000 1,200 Engineering/design changes Design changes 90,000 300 Customer use of the above activities, sales, and gross margin on sales are as follows: Activity Customer 101 Customer 102 Customer 103 200 Processing orders Sales visits Billing Engineering/design changes 1,200 50 600 20 350 10 150 700 180 85 35 Sales $256,000 $329,000 $396,000 Gross margin on sales $129,500 $137,500 $112,600 Under traditional costing, selling expenses were allocated based on sales value. 20. Net income under activity-based costing for customer 101 amounts to a. $47,500 b. - $47,500 c. $53,500 d. - $53,500 e. None of the above. 21. Net income under traditional costing for customer 102 amounts to a. $38,900 b. - $38,900 c. $52,788 d. - $52,788 e. None of the above. 22. Net income under activity-based costing for customer 103 amounts to a. $6,079 b. $-6,079 c. $79,600 d. $- 79,600 e. None of the aboveStep by Step Solution
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