Questions
Questions

ACCTMIS 3300 AU2025 (2004) Midterm 2

Single choice

Using ABC, what is the profitability of the Standard product line?

Options
A.-2.32%
B.5.21%
C.13.44%
D.5.90%
E.23.24%
F.18.74%
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We are given a question about the profitability of the Standard product line using ABC, along with a set of answer options and a provided correct value. Option 1: -2.32% — This negative figure would imply a loss, which would be unusual for a profitability reading of a standard product line under ABC unless there are misallocated costs. Without evidence of such losses, this option is inconsist......Login to view full explanation

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Question at position 17 [table] Xceltron Enterprises, has supplied the following data from its activity-based costing system. During the year, the company completed one order for a new customer. This customer did not order any other products during the year. Data concerning the customer's order is available in the fourth table below. The previous accountant has already correctly calculated activity rate for each cost pool which is provided in the fifth table below (see the table named "Computation of activity rate"). As a new managerial accountant to the firm, what is the customer margin relating to this particular customer? (Negative customer margins should be indicated by a minus sign.) | | | | | Overhead Costs | | | | | Wages and salaries | $100,000 | | | | Other overhead costs | $50,000 | | | | Total overhead costs | $150,000 | | | | | | | | | | | | | | Activity Cost Pool | Activity Measure | Total Activity | | Supporting direct labor | Number of direct labor-hours | 3,000 | DLHs | | Order processing | Number of customer orders | 600 | orders | | Customer support | Number of customers | 200 | customers | | Other | This is an organization-sustaining activity | Not applicable | | | | | | | | | | | | Distribution of Resource Consumption Across Activities | Direct Labor Support | Order Processing | Customer Support | Other | Total Wages and salaries | 30% | 40% | 10% | 20% | 100% Other overhead costs | 30% | 10% | 20% | 40% | 100% | | | | | | | | | | Data Concerning the Customer's Order | | | Units ordered | 100 | units | | | Direct labor-hours | 4 | DLHs per unit | | | Selling price | $300 | per unit | | | Direct materials | $50 | per unit | | | Direct labor | $50 | per unit | | | | | | | | Computation of activity rates | | | Activity Cost Pools | Activity Rate | | | | Supporting Direct Labor | $15.00 | per DLH | | | Order Processing | $75.00 | per order | | | Customer support | $100.00 | per customer | | | [/table]Answer[table] Xceltron Enterprises, has supplied the following data from its activity-based costing system. During the year, the company completed one order for a new customer. This customer did not order any other products during the year. Data concerning the customer's order is available in the fourth table below. The previous accountant has already correctly calculated activity rate for each cost pool which is provided in the fifth table below (see the table named "Computation of activity rate"). As a new managerial accountant to the firm, what is the customer margin relating to this particular customer? (Negative customer margins should be indicated by a minus sign.) | | | | | Overhead Costs | | | | | Wages and salaries | $100,000 | | | | Other overhead costs | $50,000 | | | | Total overhead costs | $150,000 | | | | | | | | | | | | | | Activity Cost Pool | Activity Measure | Total Activity | | Supporting direct labor | Number of direct labor-hours | 3,000 | DLHs | | Order processing | Number of customer orders | 600 | orders | | Customer support | Number of customers | 200 | customers | | Other | This is an organization-sustaining activity | Not applicable | | | | | | | | | | | | Distribution of Resource Consumption Across Activities | Direct Labor Support | Order Processing | Customer Support | Other | Total Wages and salaries | 30% | 40% | 10% | 20% | 100% Other overhead costs | 30% | 10% | 20% | 40% | 100% | | | | | | | | | | Data Concerning the Customer's Order | | | Units ordered | 100 | units | | | Direct labor-hours | 4 | DLHs per unit | | | Selling price | $300 | per unit | | | Direct materials | $50 | per unit | | | Direct labor | $50 | per unit | | | | | | | | Computation of activity rates | | | Activity Cost Pools | Activity Rate | | | | Supporting Direct Labor | $15.00 | per DLH | | | Order Processing | $75.00 | per order | | | Customer support | $100.00 | per customer | | | [/table][input]

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