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TELEIL penuu die. Frozen Foods $135,000 117,000 Fresh Baked Goods Produce $120,000 $194,000 88,000 136,000 Sales Cost of goods sold SFS estimates that store support
TELEIL penuu die. Frozen Foods $135,000 117,000 Fresh Baked Goods Produce $120,000 $194,000 88,000 136,000 Sales Cost of goods sold SFS estimates that store support expenses, in total, are approximately 23% of revenues The controller says that not every sales dollar requires or uses the same amount of store support activities. A preliminary analysis reveals store support activities for these three product lines are: Frozen Foods Baked Goods Fresh Produce 12 Activity (cost driver) Order processing (number of purchase orders) Receiving (number of deliveries) Shelf-stocking (number of hours per delivery) Customer support (total units sold) 49 52 100 131 12 22,000 0.1 35,000 70,000 The controller estimates activity-cost rates for each activity as follows: Order processing Receiving Shelf-stocking Customer support $ 81 per purchase order 108 per delivery 12.00 per hour 0.25 per item Required: 1. Prepare a product-line profitability report for SFS under the current costing system. 2. Prepare a product-line profitability report for SFS using the ABC information the controller provides
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