Question
On Bored is a company that manufactures specialty desks for computer users that play a lot of computer games. The CEO of this company has
On Bored" is a company that manufactures specialty desks for computer users that play a lot of computer games. The CEO of this company has decided to move to an Activity Based Costing system. The data from the new ABC system is listed below. Additionally, there are data from one of On Bored's customers, Procrastinet - a software developer, as well.
Overhead Costs
Cost
Wages and Salaries
$350,000.00
Other Overhead Costs
$150,000.00
Total Overhead Costs
$500,000.00
Activity Cost Pool
Activity Measure
Total Activity for the Year
Assembly
Number of Direct Labour Hours
25,000
Delivery
Number of Customer Orders
500
Customer Support
Number of Customers
400
Other
costs not allocated to products or customers
N/A
Distribution of Resource Consumption Across Activities
Volume-Related
Order-Related
Customer Support
Other
Total
Wages and Salaries
30.00%
20.00%
40.00%
10.00%
100.00%
Other Overhead Costs
50.00%
10.00%
20.00%
20.00%
100.00%
Data concerning Procrastinet's Order
Units Ordered
16
units
Direct Labour-Hours
4
DLHs per unit
Selling Price
$450.00
per desk
Direct Materials
$225.00
per desk
Direct Labour
$12.00
per hour
Using the above data, complete the following in regards to On Bored:
1.report showing first-stage allocations of overhead costs to the activity cost pools. -
2.Compute the activity rates for the activity cost pools. -
3. a report showing the overhead costs for the order from Procrastinet. -
4. a report showing the product margin for the order and the customer margin for Procrastinet. -
Please show all work .
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