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Thompson Manufacturing Company has three salaried clerks to process purchase orders. Each clerk is paid a salary of $28,000 and is capable of processing 5,000
Thompson Manufacturing Company has three salaried clerks to process purchase orders. Each clerk is paid a salary of $28,000 and is capable of processing 5,000 purchase orders per year (working efficiently). In addition to the salaries, Thompson spends $7,500 per year for forms, postage, etc. Thompson assumes 15,000 purchase orders will be processed. During the year, 12,500 orders were processed. Required: Calculate the activity rate for the purchase order activity. Break the activity into fixed and variable components. Required: Compute the total activity availability, and break this into activity output and unused activity
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