Question

Hollifield Corporation is conducting a time-driven activity-based costing study in its Order Fulfillment Department. The company has provided the following data to aid in that study: Hollifield Corporation Order Fulfillment Department Data Inputs Resource Data: Number of employees 18 Average salary per employee $ 33,300 Weeks of employment per year 50 Minutes available per week (40 hours × 60 minutes) 2,400 Practical capacity percentage 75 % Activity Data: Processing Orders Preparing Deliveries Handling Returns Minutes per unit of the activity 20 26 48 Cost Object Data: All Customers Number of orders processed 22,540 Number of deliveries prepared 15,180 Number of returns handled 1,540 On the Capacity Analysis report in time-driven activity-based costing, the “impact on expenses of matching capacity with demand” would be closest to: Multiple Choice ($199,800) ($233,100) ($259,222) ($266,400)

Answer 1