please answer question 5-19

manual processing of invoice and cash receipts = 1 hour

Electronic processing of invoice and electronic funds transfer = .1 hour

maintain customer file = .5 hour

the annual cost of accounts receivable is $500,000, and accounts receivable labor is $10,000, the accounts receivables department has 6 employees.

c. a division has 200 customers who annually generate a total of 10 million in sales and 400 invoices, customers pay electronically, what is the annual Activity based cost associated with the division?

d. how many hours of accounts receivable labor will it require for 1000 customers, 2000 manual invoices and 2000 electronic invoices?

ESTIMATED WORKER TIME Actin Manual processing of invoice and cash receipt 10 hour Flex fronic processing of invoice and electronic funds transfer (1 hour Maintain customer file 05 Four The time to process payments of customer invoices depends on whether the customer pays the bill manually or electronically, as shown above. The time to maintain each customer file is the same same Yof all customers. The annual cost of the Accounts Receivable Department is $500,000 and the associated practical capacity of accounts receivable labor is 10,000 hours. The Accounts Receivable Department has six employees. Required (a) What is the capacity cost rate for the Accounts Receivable Department? (b) Zeta's Division 1 has LOUD small- to medium-sized customers who annually generate a total of $10 million in sales, resulting in 1.010 invoices. These customers pay all their invoices manually. What is the annualactivity-based cost associated with Division 1's customers? (c) Zeta's Division 2 has 200 large customers who annually generate a total of $19 million in shawl sales, resulting in 400 invoices. These customers pay all of their invoices electronically What is the annual activity-based cost associated with Division 2's customers? d)/ Suppose half of Zeta's Division 1 customers change their method of payment to electronic next year. How many hours of accounts receivable labor will it require for LOO customers, 2,000 manual invoices, and 2,000 electronicinvoices? How much will Division 1 be charged Ar.). for the accounts receivable function? Will Zeta's costs decrease because of the shift to 50% electronic invoicing in Division 1? LA61 LO3, 5 5-20 Compute activity-based cost rate, time equations CAN Company sells multiple products and uses a time-driven ABC system. The company's products must be wrapped individually before shipping. The packaging and shipping department employs 24 people. Each person works 20 days per month on average. Employees in this department work an eight-hour shift that includes a total of 75 minutes for breaks and a meal. The full compensation, including fringe benefits, for each packaging and shipping employee is $4,050 per month. Required (a) Using the principles discussed in this chapter and time-driven ABC, what is the rate per hour for each packaging and shipping employee at CAN? (b) On average, it takes one packaging and shipping employee 15 minutes to prepare a package and label, independent of the number or types of items in the shipment, plus 5 minutes per item to bubble wrap and pack it in the carton. Using CAN's time-driven ABC system, what is the packaging and shipping cost assigned to Order 705, which consisted of 40 items? 103, 4,5 5-21 Forecasting resource capacity using a time-driven ABC system Refer to the time-driven ABC analysis of forecasting resource capacity for the Madison Dairy ice cream plant example on pages 181-184 of this chapter. Suppose that all the information is the same except for the followingTotal direct battle went Toul direct materials trel Required (al Using the company's TDABC system, how much manufacturing overhead cost wy assigned to pumps) How much will be assigned to valves? (h) What is the company's n't income? (Assume the company sells the entire amoum products it pixdices ) LOS 5-18 Capacity coats Ken's Comerspot, a popular university eatery competitive market, has seating and staff capacity to serve shout toy customers every day. For the past two months, demand has fallenand Previous near-capacity level. Concerned about his declining pes decided to take a closer look at his costs. He concluded that Insp primary cost that varied with meals served; the remaining coil. $3,300 per day were fixed. With demand averaging 550 lunches prada for the past two months, Ken thought it was reasonable to divine $3,300 fixed costs by the current average demand of 550 lunches.a string at an estimate of So of support costs per meal served. Not 1. Noting that has meal prices. support costs per meal had now increased, he contemplated raising his Required (a) What is likely to happen if Ken continues to recompute his costs using the same approach it demand decreases further? (b) Advise Ken on choosing a cost driver quantity for computing support costs per meal and explain why you advocate your choice of quantity. blems das LO 3, 5 5-19/Assigning corporate support costs, activity-based costing Zeta Departme Store has developed the following information in order to develop a time- driven ABC model for its Accounts Receivable Department: Chapter 5 Activity-Based Cost Systems