21 Reven × ain.do?invoker-assignments&takeAssignmentSessionlLocator-assigr; Calc

Question

21 Reven × ain.do?invoker-assignments&takeAssignmentSessionlLocator-assigr; Calculator Print Item Activity-Based Customer-Driven Costs Suppose that Stillwater Designs has two classes of distributors: JIT distributors and non-JIT distributors. The larger, less frequent orders. Both types of distributors are buying the same product. Stillwater Designs provi recent quarter: JIT Non-JIT Sales orders Sales calls Service calls Average order size Manufacturing cost/unit Customer costs: Distributors 900 70 350 550 $125 Distributors 90 70 175 5,500 $125 Processing sales orders Selling goods Servicing goods $3,130,000 1,120,000 1,050,000 $5,300,000 Total Required: 1. Calculate the total revenues per distributor category, and assign the customer costs to each distributor type b calculations to the nearest dollar. JIT Non-JIT Sales (in units) 495.000 495,000 All work saved.

Explanation / Answer

Step 1: Calculation of the Cost Driver Rate Cost Driver Rate = Activity Cost / Cost Driver Activity Cost / Cost Driver = Activity Cost Driver   Activity Cost   "/"   Cost Driver " = " To Cost Driver Rate Sales Order Number of Orders                       31,30,000 "/"                               990 " = " To                  3,161.62 Sales Call Number of Sales Call                       11,20,000 "/"                               140 " = " To                  8,000.00 Services Call Number of Service Call                       10,50,000 "/"                               525 " = " To                  2,000.00 Step 2: Calculation of the Cost Driver Rate Product Cost Driver Used "X " By Cost Driver Rate   " = " To Total Activity Cost Sales Order Number of Personal Trained JIT Distributors                                   900 "X " By $                     3,162 " = " To $           28,45,455 Non JIT Distributors                                     90 "X " By $                     3,162 " = " To $              2,84,545 Sales Call Numebr of Flights   JIT Distributors                                     70 "X " By $                     8,000 " = " To $              5,60,000 Non JIT Distributors                                     70 "X " By $                     8,000 " = " To $              5,60,000 Services Call JIT Distributors                                   350 "X " By $                  2,000.0 " = " To $              7,00,000 Non JIT Distributors                                   175 "X " By $                  2,000.0 " = " To $              3,50,000

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