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Instructions: Please provide your solutions to the below questions in the MOODLE quiz. Data for Q 1 and 2 Colby Company makes cases for
Instructions: Please provide your solutions to the below questions in the MOODLE quiz. Data for Q 1 and 2 Colby Company makes cases for cell phones of all sizes and types for sale through specialty retailers. The company makes a standard model for the most recent iPhone as well as a deluxe model. Management has designed an ABC system with the following activity cost pools and activity rates for these models: Activity Cost Pool Supporting manufacturing Order processing Activity Rates $2 per direct labour-hour $ 21 per order Customer service $75 per customer Management would like an analysis of the profitability of a particular customer, Cell City, which has ordered the following products over the last 12 months: Number of cases Number of orders Direct labour-bours per case Selling price per cate Direct materials cost per casE The company's direct labour rate is $24 per hour. Record your answers to two decimal places. Standard Model Deluxe Model 160 35 5 2 0.25 0.40 $40 $65 512 $15 Assume Customer Service is split equally across the two products. 1) Use Activity Based Costing to calculate the customer profitability for the Deluxe Model. 2) Use Activity Based Costing to calculate the customer profitability for the Standard Model.
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