(Appendix 7A) Krueger Corporation Is Conducting a Time-Driven Activity-Based Costing

question 2

Multiple Choice

(Appendix 7A) Krueger Corporation is conducting a time-driven activity-based costing study in its Customer Support Department. The company has provided the following data to aid in that study:
Krueger Corporation
Customer Support Department
Data Inputs
$\begin{array}{lr}\text { Resource Data: }\\\text {Number of employees }&12\\\text {Average salary per employee }&\$48,600\\\text {Weeks of employment per year. }&50\\\text {Minutes available per week ( 40 hours \( \times 60 \) minutes) }&2,400\\\text {Practical capacity percentage }&90\%\\\end{array}$
$\begin{array}{lccc}\text { Activity Data: }&\begin{array}{c}\text { Receiving } \\\text { Calls }\end{array} & \begin{array}{c}\text { Resolving } \\\text { Issues }\end{array} & \begin{array}{c}\text { Settling } \\\text { Disputes }\end{array} \\\text { Minutes per unit of the activity }&24 & 26 & 40\end{array}$ $\begin{array}{lccc}\text {Cost Object Data: }&\text { Customer S } & \text { Customer T } & \text { Customer U } \\\text {Number of calls received. }&27 & 20 & 5 \\\text {Number of issues resolved }&15 & 12 & 8 \\\text {Number of disputes settled }&1 & 1 & 0\end{array}$
-On the Customer Cost Analysis report in time-driven activity-based costing,the cost per minute of the resource supplied would be closest to:

• A) $0.45 per minute
• B) $20.25 per minute
• C) $0.41 per minute
• D) $22.50 per minute

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Definitions:

Corporate Strategy

The overall direction and scope of an organization over the long term, which achieves advantage in a changing environment through its configuration of resources.

Business Strategy

A plan of action designed to achieve a long-term or overall aim in the realm of commerce and management.

Branding Strategy

A long-term plan for the development of a successful brand in order to achieve specific goals, primarily focused on differentiating itself from competitors.

Business Strategy

A plan of action designed to achieve a company's long-term goals and compete effectively in the market.