Question

$21.000 Number of employees Average salary per employee Weeks of enployment per year Hours worked per week Practical capacity percentage Line-Iten Picking Packaging Loading Deliveries Minute per unit of the activity Customer L Customer 195 Customer N 145 Number of line itens picked Rumber of boxes packaged Number of deliveries loaded All Customers 405.000 50, 400 15. 700 Required: 1. Using the customer cost analysis as demonstrated in Exhibit 7A-2 in your textbook, compute the following: a. The cost per minute of the resource supplied in the Shipping Department. b. The time-driven activity rate for each of Stahl's three activities. c.The total labor costs consumed by Customer L. Customer M. and Customer N

Answer 1

Part 1 A

Customer service department:
Number of employees (a)	39
Average salary per employee (b)	21000
Total cost of resources supplied (a) x (b)	$819000
Practical capacity per employee (in minutes) (a) (52*40*85%*60)	106080
Number of employees (b)	39
Practical capacity of resources supplied (in minutes) (a) x (b)	4137120
Cost per minute of the resources supplied (819000/4137120)	0.20

Part 1 B

	Line-item packaging	Packaging	Loading deliveries
Minutes per unit of the activity (a)	5	15	30
Cost per minute of the resources supplied (b)	0.20	0.20	0.20
Time-driven activity rate (a) x (b)	$1	$3	$6

Part 1 C

	Customer L	Customer M	Customer N
Number of Line-items picked (a)	295	195	145
Time-driven activity rate (b)	1	1	1
Line-item packaging costs assigned (a) x (b)	295	195	145
Number of boxes packed	49	29	31
Time-driven activity rate (b)	3	3	3
packaging costs assigned (a) x (b)	147	87	93
Number of deliveries loaded	6	2	10
Time-driven activity rate (b)	6	6	6
Loading deliveries costs assigned (a) x (b)	36	12	60
Total customer service costs assigned (line-item packaging cost packaging cost + loading deliveries cost)	$737	$477	$383