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Total Revenue (TR) = Quantity Sold (Q) x Price (P)
Answers
University
Memorial
Total
Purchase price
$30,000.00
$30,000.00
$60,000.00
Margin
6%
6%
6%
Total Revenue
$31,800.00
$ 31,800.00
$63,600.00
Activity Cost Pool (Activity Measure)
Total Cost
Total Activity
Activity Rates
Customer deliveries (Number of deliveries)
$435,000.00
5000
Deliveries
$87.00
per deliveries
Manual order processing (Number manual orders)
$355,000.00
5000
Orders
$71.00
per orders
Electronic order processing (Number electronic orders)
$240,000.00
12000
Orders
$20.00
per orders
Line item selection (Number chosen)
$799,500.00
410000
Line items
$1.95
per line items
Overhead cost assigned to:
University
$2,226.00
Memorial
$6,493.00
–Workings
UNIVERSITY
Activity Cost Pool (Activity Measure)
Total Cost
Activity Rates
No. of cost drivers
Cost Allocated
Customer deliveries (Number of deliveries)
$435,000.00
$87.00
per deliveries
19
$1,653.00
Manual order processing (Number manual orders)
$355,000.00
$71.00
per orders
0
$ –
Electronic order processing (Number electronic orders)
$240,000.00
$20.00
per orders
15
$300.00
Line item selection (Number chosen)
$799,500.00
$1.95
per line items
140
$273.00
Total Cost Allocated
$2,226.00
MEMORIAL
Activity Cost Pool (Activity Measure)
Total Cost
Activity Rates
No. of cost drivers
Cost Allocated
Customer deliveries (Number of deliveries)
$435,000.00
$87.00
per deliveries
30
$2,610.00
Manual order processing (Number manual orders)
$355,000.00
$71.00
per orders
47
$3,337.00
Electronic order processing (Number electronic orders)
$240,000.00
$20.00
per orders
0
$ –
Line item selection (Number chosen)
$799,500.00
$1.95
per line items
280
$546.00
Total Cost Allocated
$6,493.00
University
Memorial
Total revenues
$31,800.00
$31,800.00
Less:
Selling price of goods
$30,000.00
$30,000.00
Allocation of overhead costs
$2,226.00
$6,493.00
Margin
$(426.00)
$(4,693.00)