please correct the following wrong answer- Silicon Optics has supplied the follo

Question

please correct the following wrong answer-

Silicon Optics has supplied the following data for use in its activity-based costing system Overhead Costs Wages and salaries Other overhead costs $ 343,000 194,000 Total overhead costs $537,000 Activity Cost Pool Direct labor support Order processing Customer support Other Total Activity 570 orders Not applicable Activity Measure Number of direct labor-hours Number of orders Number of customers This is an organization-sustaining activity 12,000 DLHs 100 customers Distribution of Resource Consumption Across Activities Direct Labor Order Customer SupportProcessing Support Wages and salaries Other overhead costs 10% 30% 30% 20% 20% 20% Other 40% 30% Total 100% 100% 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: Data Concerning the Indus Telecom Order Selling price Units ordered Direct materials Direct labor-hours Direct labor rate $ 270 per unit 100 units $ 254 per unit 0.5 DLH per unit $27 per DLH

Explanation / Answer

1) Direct order Customer other total labor processing support Support Wages & Salaries 34300 102900 68600 137200 343000 Other overhead costs 58200 38800 38800 58200 194000 total 92500 141700 107400 195400 537000 2) Activity Activity cost pool rate Direct labor support (92500/12000) 7.71 per DLH order processing (141,700/570) 248.60 per order Customer support (107400/100) 1074.00 per customer 3) ABC Activity cost pool Cost Direct labor support (100*.5*7.71) 385.50 order processing (1*248.60) 248.60 customer support (1*1074) 1074.00 total 1708.10

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