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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 individual jobs. To aid the study, the company provided the following data regarding its Purchasing Department and three of its many jobs:

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somebody can help me to solve this problem?

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Required:
1. Will the revised activity demands affect the total Purchasing Department labor costs assigned to Job X, Job Y, and Job Z?
2. Using the revised activity demands, calculate Saratoga's used capacity in minutes.
3. Using the revised activity demands, calculate Saratoga's unused capacity in minutes.
decimal places.)
4. Using the revised activity demands, calculate Saratoga's unused capacity in number of employees. (Round your answer to 2
5. Based on the revised activity demands, calculate the impact on expenses of matching capacity with demand. (Be sure to round
down your potential adjustment in the number of employees to a whole number. Negative amount should be indicated by a minus
sign.)
X Answer is complete but not entirely correct.
Revised activity
demands affect total Purchasing Department labor costs assigned to Jobs X, Y and
Yes X
979,500
Used capacity in minutes
2 358,540 x
Unused capacity in minutes
22.23 X
Unused capacity in number of employees
244.690 X
Impact on expenses of matching capacity with demand
Prey

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Number of employees
Average salary per employee
13
$ 26, 500
Weeks of employment per year
52
Hours worked per week
40
Practical capacity percentage
85%
Requisition
Bid
Processing
Evaluation
Inspection
Minutes per unit of the activity
15
45
30
Job X
Job
Job Z
Number of requisitions processed
3
Number of bid evaluations
Number of inspections
Now assume that Saratoga Company would like to answer the following "what if" question using its time-driven activity-based costing
system: Assuming our estimated activity demands for all jobs in the next period will be as shown below, how will this affect our job
costs and our staffing levels within the Purchasing Department?
Requisition
Bid
Processing
Evaluation Inspection
Activity demands for all jobs
8, 400
11, 109
11, 800
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Top Answer

1) No 2) Used capacity in minutes = 979,500 3) Unused... View the full answer

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