Activity Availability, Capacity Used, Unused Capacity Corazon Manufacturing Company has a purchasing department staffed by five purchasing...

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Accounting

Activity Availability, Capacity Used, Unused Capacity
Corazon Manufacturing Company has a purchasing departmentstaffed by five purchasing agents. Each agent is paid $30,000 peryear and is able to process 3,000 purchase orders. Last year,13,350 purchase orders were processed by the five agents.
Required:
1. Calculate the activity rate per purchaseorder.
$ per purchase order
2. Calculate, in terms of purchase orders,the:
a. Total activity availability purchase orders
b. Unused capacity purchase orders
3. Calculate the dollar cost of:
a. Total activity availability $
b. Unused capacity $
4. Express total activity availability in termsof activity capacity used and unused capacity. Express totalactivity availability in terms of activity capacity used and unusedcapacity.
Purchase orders
Total activity availability Activity capacity used Unused capacity
= +

Dollars cost
Total activity availability Activity capacity used Unused capacity
$ = $ + $
5. What if one of thepurchasing agents agreed to work half time for $15,000?
a. How many purchase orders could be processed by four and ahalf purchasing agents?
purchase orders
b. What would unused capacity be in purchase orders?
purchase orders

Answer & Explanation Solved by verified expert

3.8 Ratings (310 Votes)

1 Activity rate per purchase order 10 Explanation Activity rate per purchase order 30000 3000 10 2 a Total activity availability 15000 purchase orders b Unused See Answer

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a.	Total activity availability	purchase orders
b.	Unused capacity	purchase orders

Total activity availability		Activity capacity used		Unused capacity
	=		+