Market Analysis Group LLC offers specialized surveys to companies that do not have internal marketing research staff.
Question:
Market Analysis Group LLC offers specialized surveys to companies that do not have internal marketing research staff. A typical survey involves three activities: survey proposal and design, data collection and analysis and report preparation. The total costs consist of project salaries (which are directly traced to the individual survey projects) and support activity costs. The projects that Market Analysis Group carries out can be classified into two categories: Large projects that typically involve a few weeks of work and small projects that involve only a few days of work. These two types of projects, respectively, had consumed project salaries of $100,000 and 80,000 in 2014. Information on the consumption of the various activity drivers for the large and small projects as well as the total costs for the various activities is provided below:
Proposal -- Data Collection -- Report preparation -
Number of Trips Number of Days Number of pages
Product
Large 15 100 500
Small 35 400 500
Total activity costs $40,000 $30,000 $20,000
- ) If all support activity costs had been allocated on the basis of project salaries, what is the total amount of overhead charged to Small and Large projects, respectively? Show your calculations.