O 1) Classic Brass, Inc, makes two main product tines for luxury cars and custom
ID: 2333040 • Letter: O
Question
O 1) Classic Brass, Inc, makes two main product tines for luxury cars and custom car. The company has provided the following data:- namely, sti Aetivity Cost Pool Supporting direct labor Order processing Custom design processing Customer services Activity Rate S30 per direct lahor-hour $290 per order 180 per custom design S380 per customer who has ordered the following items over the past three months oriffise would like to korw the profitability lirahim. Standard Car Custom Car Number of designs Direct labor hours per car27 Selling price per car Direct materials cost per car S600 30 S3,000 $700 $2,000 Number of cars Number of orders 20 The company's direct labor rate is S0.25 per minute Instruction: Using the company's activity-based costing system, prepare a report showing the margin from the customer of Classic Brass, Inc. (6 marks)Explanation / Answer
No Activities Rate Amount Supporting Direct Labor 27*20 540 $30.00 $16,200.00 Order Processing 3 $290.00 $870.00 Custom Design Processing 1 $180.00 $180.00 Customer Services 1 $380.00 $380.00 Overhead Cost Standard Car $17,630.00 No Activities Rate Amount Supporting Direct Labor 30*3 90 $30.00 $2,700.00 Order Processing 6 $290.00 $1,740.00 Custom Design Processing 6 $180.00 $1,080.00 Customer Services 1 $380.00 $380.00 Overhead Cost Custom Car $5,900.00 Standard Car Custom Car Selling Price 40000 9000 Less Direct Material 12,000.00 2,100.00 Direct Labor 8,100.00 1,350.00 Overhead Cost 17,630.00 5,900.00 Total Cost 37730 9350 Profit Margin 2270 -350
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