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(Solved) Fermi Company decided to look more closely at the materials receiving activity in its factory. The driver for receiving is the number of receiving...


Fermi Company decided to look more closely at the materials receiving activity in its factory. The driver for receiving is the number of receiving orders. The following information for a year was collected:

Demand for receiving orders: 130,200

Resources needed:

A. 6 workers capable of completing 25,500 receiving orders per year. (The completion of a receiving order requires unloading the materials onto the receiving dock, checking the receiving order against the purchase order and invoice, and carrying the materials to the materials storeroom.) Salary is $27,200 for each worker

B. Supplies (paper, greasemarkers, small tools, rags) expected to cost $0.75 per receiving order

C. Workbenches, dollies, computers, etc.; depreciation $13,600 per year

D. Space for the receiving dock, utilities; $10,400 per year

Required:

1. Prepare a static budget for the receiving activity for the year.

2. Calculate the cost per receiving order based on annual demand for receiving orders. (Note: Round to the nearest cent.)

 


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