Question

2. value: 4.00 points Xie Company identified the following activities, costs, and activity drivers for 2015. The company manufactures two types of go-karts: Deluxe and Basic. Activity Handling materials Inspecting product Processing purchase orders Paying suppliers Insuring the factory Designing packaging Expected Costs $ 625,000 900,000 105,000 175,000 300,000 75,000 Expected Activity 100,000 parts 1,500 batches 700 orders 500 invoices 40,000 square feet 2 models Required: Compute the activity rate for each activity, assuming the company uses activity-based costing. (Round activity rate answers to 2 decimal places.) Activity Rate Activity Handling materials Inspecting product Processing orders Paying suppliers Insuring factory Designing packaging Expected Costs 625,000 900,000 105,000 175,000 300,000 75,000 $ 2,180,000 Activity Driver 100,000 parts 1,500 batches 700 orders 500 invoices 40,000 square feet 2 models

Answer 1

Ans:

Activity	Expected Cost-$	Activity drive		Activity rate
Handling Materials	625000	100,000	Parts	6.25	Per part
Inspecting Products	900000	1,500	Batches	600	Per batch
Processing Purchase order	105000	700	Orders	150	per order
Paying suppliers	175000	500	Invoices	350	Per invoice
Insuring the factory	300000	40,000	square feet	7.5	Per square feet
Designing Packaging	75000	2	Models	37500	Model
	2,180,000