Fitzgerald Supermarkets (FS) operates at capacity and de-cides to apply ABC analysis to three product lines: baked goods, milk and fruit juice, and frozen foods. Itidentifies four activities and their activity cost rates as follows:$95 per purchase orderS76 per delivery$19 per hour$0.15 per item soldOrderingDelivery and receipt of merchandiseShelf-stockingCustomer support and assistanceThe revenues, cost of goods sold, store support costs, activities that account for the store support costs,and activity-area usage of the three product lines are as follows:Baked GoodsMilk and Fruit JuiceFrozen ProductsFinancial dataS66,500$51,000$15,300S50,500$32,000$ 9,600RevenuesS60,000S41,000Cost of goods soldStore supportActivity-area usage (cost-allocation base)Ordering (purchase orders)Delivery (deliveries)Shelf-stocking (hours)Customer support (items sold)$12,30024441412060361701502020,20015,4007,960Under its simple costing system, FS allocated support costs to products at the rate of 30% of cost of goodssold.

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Asked Feb 14, 2020
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Q1. Use the simple costing system to prepare a product-line profitability report for FS.

Fitzgerald Supermarkets (FS) operates at capacity and de-
cides to apply ABC analysis to three product lines: baked goods, milk and fruit juice, and frozen foods. It
identifies four activities and their activity cost rates as follows:
$95 per purchase order
S76 per delivery
$19 per hour
$0.15 per item sold
Ordering
Delivery and receipt of merchandise
Shelf-stocking
Customer support and assistance
The revenues, cost of goods sold, store support costs, activities that account for the store support costs,
and activity-area usage of the three product lines are as follows:
Baked Goods
Milk and Fruit Juice
Frozen Products
Financial data
S66,500
$51,000
$15,300
S50,500
$32,000
$ 9,600
Revenues
S60,000
S41,000
Cost of goods sold
Store support
Activity-area usage (cost-allocation base)
Ordering (purchase orders)
Delivery (deliveries)
Shelf-stocking (hours)
Customer support (items sold)
$12,300
24
44
14
120
60
36
170
150
20
20,200
15,400
7,960
Under its simple costing system, FS allocated support costs to products at the rate of 30% of cost of goods
sold.
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Fitzgerald Supermarkets (FS) operates at capacity and de- cides to apply ABC analysis to three product lines: baked goods, milk and fruit juice, and frozen foods. It identifies four activities and their activity cost rates as follows: $95 per purchase order S76 per delivery $19 per hour $0.15 per item sold Ordering Delivery and receipt of merchandise Shelf-stocking Customer support and assistance The revenues, cost of goods sold, store support costs, activities that account for the store support costs, and activity-area usage of the three product lines are as follows: Baked Goods Milk and Fruit Juice Frozen Products Financial data S66,500 $51,000 $15,300 S50,500 $32,000 $ 9,600 Revenues S60,000 S41,000 Cost of goods sold Store support Activity-area usage (cost-allocation base) Ordering (purchase orders) Delivery (deliveries) Shelf-stocking (hours) Customer support (items sold) $12,300 24 44 14 120 60 36 170 150 20 20,200 15,400 7,960 Under its simple costing system, FS allocated support costs to products at the rate of 30% of cost of goods sold.

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