Question :
122.A company estimates that ordering costs $4.00 per order, picking : 1302815
122.A company estimates that ordering costs are $4.00 per order, picking costs are $3.00 per unique item ordered, packing costs are $0.04 per item, and return costs are $70.00 per return. A customer makes 50 orders, orders 80 unique items, and 900 total items. The customer makes 11 returns. The pricing structure is to charge customers for the cost of the services that are provided. Using activity-based pricing for each of the above items, what will be the total amount of additional cost paid by the customer?
A.$1,246
B.$77.04
C.$1,540
D.$476
123.A company using activity-based pricing marks up the direct cost of goods by 30% and then adds the cost of the services that are provided. Indirect costs are charged as follows: $8.00 per order placed; $4.00 per separate item ordered; $30.00 per return. A customer places 10 orders with a total direct cost of $3,000, orders 300 separate items, and makes 5 returns. What will the customer be charged?
A.$3,000
B.$3,900
C.$5,330
D.$5,759
124.Marquez Enterprises uses activity-based pricing and marks up the direct cost of goods by 40%. In addition, the customer is charged for indirect costs based on the activities utilized. Indirect costs are as follows: $7 per order placed and $11 per return. A customer places 12 orders with a direct cost of $6,100 and makes 2 returns. How much in indirect costs will the customer be charged?
A.$18
B.$106
C.$6,206
D.$2,440
125.A custom yacht-building company uses activity-based pricing. The company’s annual activity pools and related information follow:
Cost PoolEstimated CostCost Driver Driver Quantity
Design $2,500,000 Number of designs80 designs
Production 4,000,000 Labor hours125,000 labor hours
Customer service 80,000 Number of customers20 customers
The pricing structure is to charge customers for the cost of the services that are provided. One particular customer requested 2 different designs which led to the production of one yacht which took 2,400 labor hours to complete. What additional costs will be charged to this customer?
A.$143,300
B.$112,050
C.$139,300
D.$108,050
126.A law firm uses activity-based pricing. The company’s annual activity pools and related information are as follows:
Cost PoolEstimated CostCost DriverDriver Quantity
Consultation $125,000 Number of consultations200 consultations
Administrative costs 66,000 Admin labor hours6,000 labor hours
Client service 34,000 Number of clients400 clients
The pricing structure is to charge customers for the cost of the services that are provided. The firm had four consultations with Doris Lansing and required 88 administrative labor hours. What additional costs will be charged to this customer?
A.$636
B.$721
C.$3,468
D.$3,553
127. A law firm uses activity-based pricing. The company’s annual activity pools and related information are as follows:
Cost PoolEstimated CostCost DriverDriver Quantity
Consultation $125,000 Number of consultations200 consultations
Administrative costs 66,000 Admin labor hours6,000 labor hours
Client service 34,000 Number of clients400 clients
The pricing structure is to charge customers for the cost of the services that are provided. The firm had two consultations with Randall’s Auto Shop and required 64 administrative labor hours. What additional costs will be charged to this customer?
A.$1,954
B.$2,039
C.$721
D.$1,442
128. Veterinarians Johns & Doggins have analyzed their customer data for the past year and have determined the following costs:
Customer inquiries cost each $ 12
Additional costs if inquiry is after hours 20
Dispensing of prescriptions 18
Relationship management costs (Per customer per year) 800
In addition to these costs, product costs amount to 75% of sales. In the prior year, Johns & Doggins had the following experience with one of its customers, Millie Woods:
Sales $3,100
Total number of inquiries 50
Percent of after-hours inquiries 80%
Prescriptions dispensed 26
For the coming year, Johns & Doggins have told Woods that she will be switched to an activity-based pricing system or will be dropped as a customer. In addition to regular prices, Woods will be required to pay:
Inquiries $18 each
After hours inquiries $21 each
Prescription dispensing $22 each
How much is the additional revenue to be charged to Woods account if activity is the same as in the prior year?
A.$2,312
B.$2,392
C.$3,112
D.$3,952
