Worley Company buys surgical supplies from a variety of manufacturers and then resells and delivers these supplies to hundreds of hospitals Worley sets its prices for all hospitals by marking up its cost of goods sold to those hospitals by 9% For example, if a hospital buys supplies from Worley that cost Worley $100 to buy from manufacturers, Worley would charge the hospital S109 to purchase these suppiles For years. Worley believed that the 9% markup covered its selling and administrative expenses and provided a reasonable protit However, in the face of declining profits Worley decided to implement an activity-based costing system to help improve its understanding of customer profitability. The company broke its selling and administrative expenses into five activities as shown Activity Cost Pool Activity Measure) Customer deliveries (Number of deliveries) Manuel onder processing Number of manual orders) Electronic order processing Number of electronic orders) Line Stem picking Number of line items picked) Other organization-sustaining costs (Hone) Total selling and administrative expenses Totalt 602.000 000 336.ee 575.000 600.000 $ 2,61211 Total Activity er deliveries 5,000 orders 14, order's 18. Dine items Worley gathered the data below for two of the many hospitals that it servest University and Memorial (each hospital purchased medical supplies that had cost Worley $40,000 to buy from manufacturers Activity University 17 Activity Measuri Number of deliveries Number of sual orders Number of electronic arders Number of line itens picked 120 250 Required: 1. Compute the total revenue that Worley would receive from University and Memorial 2. Compute the activity rate for each activity cost pool 3. Compute the total activity costs that would be assigned to University and Memorial 4. Compute Worley's customer margin for University and Memorial (Hint. Do not overlook the $40,000 cost of goods sold that Worley incurred serving each hospital) Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 4 Required 3 Compute the total revenue that Worley would receive from University and Memorial Total Revenue University Memorial Required 1 Required 2 Required 3 Required 4 Compute the activity rate for each activity cost pool. (Round your answers to 2 decimal places.) Activity Cost Pool Activity Rate Customer deliveries per delivery Manual order processing per manual order Electronic order processing per electronic order Line item picking per line item picked Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Compute the total activity costs that would be assigned to University and Memorial. Total Activity Costs University Memorial Required 1 Required 2 Required 3 Required 4 Compute Worley's customer margin for University and Memorial. (Hint: Do not overlook the $40,000 cost of goods sold tha Worley incurred serving each hospital.) (Loss amounts should be indicated with a minus sign. Round your intermediate calculations to 2 decimal places. Round your final answers to the nearest whole number.) Customer Margin University Memorial
