Silicon Optics has supplied the following data for use in its activity-based cos

Question

Silicon Optics has supplied the following data for use in its activity-based costing system During the year. Silicon Optics completed an order for a special optical switch for a new customer. Indus Telecom This customer did not order any other products during the year. Data concerning that order follow: Prepare a report showing the overhead costs for the order from Indus Telecom including customer support costs (Round your intermediate calculations to 2 decimal places.) Prepare a report showing the customer margin for Indus Telecom. (Negative margins should be indicated by a minus sign.)

Explanation / Answer

3.

Customer marging for indus telecom for new order:

Totall margin=$19.5*80-$360+$1,400=-$200

activity Direct labour support order processing customer support others    total    Wages and salaries % 20% 30% 20% 30% Wages and salaries amount 80,000 120,000 80,000 120,000 400,000 Activity measure 10,000 DLHs 500 orders 100 customers - - A:Wages and salaries amount per unit 8 240 800 Other overhead costs % 20% 20% 20% 40% Other overhead costs in amount 60,000 60,000 60,000 120,000 300,000 Activity measure 10,000DLHs 500 orders 100 customers - - B:Other overhead costs in amount per unit 6 120 600 Total cost 14 360 1,400

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