P5-25 (similar to) Question Help Hollman Company uses a traditional activity-based costing system to assign $600,000 of committed resource costs for customer service on the basis of the following information gathered from interviews with customer service personnel: E: (Click the icon to view the information.) Read the requirements. Requirement (a) Compute the activity cost driver rates using this system. (Round your answers to the nearest cent.) Requirements Activity Activity Cost Driver Rate Handle customer orders Process customer complaints Perform customer credit checks i Data Table Requirements (a) Compute the activity cost driver rates using this system. (b) Suppose instead that Hollman uses time-driven ABC to assign the $600,000 of committed resource costs to the three activities. Compute the time-driven activity cost driver rates, assuming 10,000 hours of useful work and the unit time estimates that follow: Activity Unit Time (Hours) Handle customer orders 0.75 Process customer complaints 2.75 Perform customer credit checks 3.50 Activity Time Percentage Estimated Cost Driver Quantity 65% 6,500 customer orders Handle customer orders Process customer complaints 300 customer complaints 10% 25% Perform customer credit checks 600 credit checks 100% (c) Suppose that the quantities of activities this period are 6,500 customer orders, 300 customer complaints, and 600 credit checks. Using the information and activity cost driver rates developed in part b, determine the cost assigned to each of the activities and the estimated hours of unused capacity as well as the associated cost. What actions might managers take after evaluating such information? (d) Suppose that in the next time period, the quantities of activities change to 7,000 customer orders, 240 customer complaints, and 650 credit checks. Using the information and activity cost driver rates developed in part b, determine the cost assigned to each of the activities and the estimated hours of unused capacity as well as the associated cost. (e) Explain why the activity cost driver rates computed in part a are different from the rates computed in part b. Print Done Enter any number in the edit fields and then click Check Answer. Print Done 7 parts remaining