ABC

Bernacke Corp. is instituting an activity$-$based costing project in its ten$-$person purchasing department. Annual departmental overhead costs are $$731,250.$ Because finding the best supplier takes the majority of effort in the department, most of the costs are allocated to this activity area. Many purchase orders are received in a single shipment.

ActivityAllocation MeasureQuantityTotal CostFind best suppliersNumber of telephone calls$75,000$$$375,000$ Issue purchase ordersNumber of purchase orders$46,875187,500$Review receiving reportsNumber of receiving reports$28,125168,750$

One special$-$order product manufactured by the company required the following purchasing department activities: $25$ telephone calls, $50$ purchase orders, and $35$ receipts.

a$.$ What amount of purchasing department cost should be assigned to this product?

Note: Round your final answer to two decimal places $($i$.$e$.$ round $$4\mathrm{.}355$ to $$4\mathrm{.}36).$

$Answer $1$

b$.$ If $100$ units of the product are manufactured during the year, what is the purchasing department cost per unit?

Note:Round your final answer to two decimal places $($i$.$e$.$ round $$4\mathrm{.}355$ to $$4\mathrm{.}36).$

$Answer $2$per unit

c$.$ If purchasing department costs had been allocated using telephone calls as the allocation base, how much cost would have been assigned to this product?

Note:Round your final answer to two decimal places $($i$.$e$.$ round $$4\mathrm{.}355$ to $$4\mathrm{.}36).$

$Answer $3$