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Silicon Optics has supplied the following data for use in its activity-based costing system: Overhead Costs Wages and salaries $ 357,000 Other overhead costs 193,000
Silicon Optics has supplied the following data for use in its activity-based costing system: |
Overhead Costs | |||
Wages and salaries | $ | 357,000 | |
Other overhead costs | 193,000 | ||
Total overhead costs | $ | 550,000 | |
Activity Cost Pool | Activity Measure | Total Activity | |
Direct labor support | Number of direct labor-hours | 9,000 | DLHs |
Order processing | Number of orders | 490 | orders |
Customer support | Number of customers | 115 | customers |
Other | This is an organization-sustaining activity | Not applicable | |
Distribution of Resource Consumption Across Activities | ||||||||||
Direct Labor Support | Order Processing | Customer Support | Other | Total | ||||||
Wages and salaries | 10 | % | 25 | % | 20 | % | 45 | % | 100 | % |
Other overhead costs | 25 | % | 15 | % | 15 | % | 45 | % | 100 | % |
During the year, Silicon Optics completed an order for a special optical switch for a new customer, Indus Telecom. This customer did not order any other products during the year. Data concerning that order follow: |
Data Concerning the Indus Telecom Order | |||
Selling price | $ | 325 | per unit |
Units ordered | 100 | units | |
Direct materials | $ | 256 | per unit |
Direct labor-hours | 1.1 | DLH per unit | |
Direct labor rate | $ | 26 | per DLH |
Prepare a report showing the customer margin for Indus Telecom. (Negative customer margins should be indicated by a minus sign. Round your intermediate calculations and final answers to 2 decimal places.) | |
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