Stahl Company is conducting a time-driven activity-based costing study in its Shipping Department. To aid the study, the company provided the following data regarding its Shipping Department and the customers served by the department:

Number of employees ........................................ 34

Average salary per employee ......................... $34,000

Weeks of employment per year .............................. 52

Hours worked per week ...................................... 40

Practical capacity percentage ............................. 80%

Required:
1. Using the customer cost analysis shown in Exhibit 7A-2 as your guide, compute the following:
Exhibit 7 A- 1: Ridley Company: The Data Inputs

a. The cost per minute of the resource supplied in the Shipping Department.
b. The time-driven activity rate for each of Stahl's three activities.
c. The total labor costs consumed by Customer L, Customer M, and Customer N.
2. Using the capacity analysis shown in Exhibit 7A-3 as your guide, compute the following:
Exhibit 7 A- 2: Ridley Company: Customer Cost Analysis

a. The used capacity in minutes.
b. The unused capacity in minutes.
c. The unused capacity in number of employees. (Do not round your answer to a whole number.)
d. The impact on expenses of matching capacity with demand. (Be sure to round your potential adjustment in the number of employees to a whole number.)

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Line-ltem Loading Picking Packaging Deliveries Minutes per unit of the activity 15 30 All Customer L Customer M CustomerN Customers Number of line items picked Number of boxes packaged Number of deliveries loaded 280 50 6 160 20 30 15 10 335,000 463) 12,100 Ridley Company Customer Service Department Data Inputs 5 Resource Doto: 6 Number of employees 7 Average salary per employee 30 s 29,952 9 Weeks per year 10 Minutes available per week 140 hours x60 minutes) 11 Practical capacity percentage 12 52 2,400 80% Query Credit processing resolution riews Order 13 Activity Doto: 14 Minutes per unit of the activity 10 30 16 Cost Object Doto: 17 Number of orders processed 18 Number of customer queries 19 Number of credit reviews Customer A Customer B Customer C All Customers 18 4,500 B,900 17 10 Ridley Company Customer Service Department Customer Cost Analysis 5 Step 1: Calculate the cost per minute of the resource supplied 7 Customer Service Department: 8 Number of employees (a) 9 Average salary per employee (b 10 Total cost of resources supplied (a)xb) 30 s 29,952 S 898,560 12 Practical capacity per employee (in minutes) la 13 Number of employees (b) 99,840 30 eh 14 Practical capacity of resources supplied in minutes) (a) x b) 2,995,200 15 16 Cost per minute of the resource supplied S 0.30 OrderQuery Credit 18 Step 2: Calculate the time-driven activity rate 19 Minutes per unit of the activity (a) 20 Cost per minute of the resource supplied (b 21 Time-driven activity rate (a) x (b) processing resolution reviews 30 0.3$0.30 0.30 9.00 $ 12 12.00 23 Step 3: Assign costs to cost objects 24 Number of orders processed (B) 25 Time-driven activity rate ( 26 Order processing costs assigned (a) x(b) CustomerA CustomerB Customer c 30 18 5 3.00 3.00 3.00 90.00 54.00 21.00 28 Number of customer queries (a) 29 Time-driven activity rate ( 30 Query resolution costs assigned (a) x(b) 10 S 9.00 .00 S 9.00 5 153.00 90.00 72.00 32 Number of credit checks (a) 33 Time-driven activity rate (b 34 Credit review costs assigned (a) xb) S 12.00 12.00 12.00 12.00 12.00 12.00 35 36 Total customer service costs assigned 37 255.00 156.00105.00