Question

jungle junior company manufactures and sells outdoor play equipment. jungle junior uses activity-based costing to determine the cost of the sales order processing and the customer return activity. the sales order processing activity has an activity rate of $20 per sales order, and the customer return activity has an activity rate of $100 per return. jungle junior sold 2,500 swing sets, which consisted of 750 orders and 80 returns.

Answer 1

The action will cost Rs 23,000 in total.

Rs 9.20 is the total activity cost per unit. Selling and administrative costs under activity-based costing

(a) Total Activity cost Cost for Activity Number (A) (B) Total(AB) Processing of sales orders: 750 Rs. 20 Rs. 15000 80 Rs.  worth of customer returns cost 8000 Rs. 23000 rupees total So, Rs. 23,000 is the entire activity cost.

(b) The price to process a sales order is Rs. 15,000. Swing set sales total 2,500 rupees. Cost per unit for processing sales orders is =150002,500, or Rs. 6 per unit. Rs 8000 in cost-return activities Swing sets cost Rs 2,500 each. Cost of customer returns = 80002,500 = Rs 3.20 per item The total activity cost per unit is Rs 9.20 (6.00 + 3.20).

By selling and administrative costs, what do you mean?

Selling, general, and administrative (SG&A) expenditures are all ongoing business expenses that are unrelated to the production of goods or the rendering of services. Examples of common SG&A costs include rent, payroll, marketing and advertising expenses, and distribution fees.

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