Calculate the time-driven activity rate for each of Saratoga’s three activities.

Question

Calculate the time-driven activity rate for each of Saratoga’s three activities. (Round your intermediate calculations and final answers to 2 decimal places.)

Calculate the total purchasing labor costs assigned to Job X, Job Y, and Job Z. (Round your intermediate calculations and final answers to 2 decimal places.)

Saratoga Company manufactures Jobs to customer specifications. The company Is conducting a time-driven activity-based costing study In its Purchasing Department to better understand how Purchasing Department labor costs are consumed by Indlvidual Jobs. To ald the study, the company provided the following data regarding Its Purchasing Department and three of its many jobs: Nunber of enployees Average salary per enployee Weeks of employment per year 23 s 22,888 Hours worked per week Practical capacity percentage 52 48 85% Requisition 15 Job X Bid Processing Evaluation Inspection Minutes per unit of the activity 38 Job Y Job Z Number of requisitions processed Nunber of bid evaluations Number of inspections 1. Calculate the cost per minute of the resource supplied In the Purchasing Department. 2. Calculate the time-driven actMity rate for each of Saratogas three activities. 3. Calculate the total purchasing labor costs assigned to Job X, Job Y, and Job Z Complete this question by entering your answers in the tabs below. Required Required 2 Required 3 Calculate the cost per minute of the resource supplied in the Purchasing Department. (Round your answer to 2 decimal places.) Cost per minute of the resource supplied Required 2

Explanation / Answer

Calculation of cost per minute:

A=Total no of minutes available for production= 23 employees * 52 weeks * 40 hours/week * 60 minutes/hour * 85%capacity = 2439840minutes.

B=Total cost per annum for purchasing department = 23 employees * 22000 P.A = 506000.

cost per minuteof the resourfe supplied = B/A = 506000/2439840 = $0.2074per minute.

Note: Avg Salary given in the problem is taken per annum

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