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Saratoga Company manufactures jobs to customer specifications. The company is conducting a time-driven activity-based costing study in its Purchasing Department to better understand how Purchasing
Saratoga Company manufactures jobs to customer specifications. The company is conducting a time-driven activity-based costing study in its Purchasing Department to better understand how Purchasing Department labor costs are consumed by individual jobs. To aid the study, the company provided the following data regarding its Purchasing Department and three of its many jobs: Number of employees Average salary per employee Weeks of employment per year Hours worked per week Practical capacity percentage 18 $ 27,000 52 40 85% Requisition Processing 15 Bid Evaluation Inspection 30 Minutes per unit of the activity Job Y Number of requisitions processed Number of bid evaluations Number of inspections Job X 6 2 Job Z 2 Required 1. Calculate the cost per minute of the resource supplied in the Purchasing Department. 2. Calculate the time-driven activity rate for each of Saratoga's three activities. 3. Calculate the total purchasing labor costs assigned to Job X, Job Y, and Job Z
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