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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
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 19 $ 23,500 52 40 85% Requisition Processing Bid Evaluation Inspection 15 45 30 Minutes per unit of the activity Job X Job Y Job 2 Number of requisitions processed 7 4 3 Number of bid evaluations 2 4 Number of inspections 6 2 6 In addition, assume that Saratoga Company provided the following activity data for all jobs produced during the year Requisition Processing 12,400 Bid Evaluation 15,500 Inspection 19,400 Activity demands for all jobs Required: 1. Calculate Saratoga's used capacity in minutes. 2. Calculate Saratoga's unused capacity in minutes.
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