Reference no: EM132620877
Question - 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. Show static budget for the receiving activity for the year.
2. Calculate the cost per receiving order based on annual demand for receiving orders.