3. Zigwell Manufacturing spent an average of $18 per order to issue 30,000 purchase orders last year.Of the cost per order, 60% was related to office and warehouse wage costs, 21% to office costs, 6%to overhead, and 13% to warehouse costs. Zigwell estimates that all wage costs will increase 4.6%thisand all other costs of purchasing will increase 2.1%. a. What are the total estimatedyearpurchasing costs for this year? b. If the same number of purchase orders is issued this year as lastyear, what is the estimated cost per purchase order, to the nearest cent?

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Description: 3. Zigwell Manufacturing spent an average of $18 per order to issue 30,000 purchase orders last year.Of the cost per order, 60% was related to office and warehouse wage costs, 21% to office costs, 6%to overhead, and 13% to warehouse costs. Zigwell e

Formula for total purchasing cost Average cost per order × Number of orders

Business

Accounting

Zigwell Manufacturing spent an average of $18 per order to issue 30,000 purchase orders last year. Of the cost per order, 60% was related to office and warehouse wage costs, 21% to office costs, 6% to overhead, and 13% to warehouse costs, Zigwell estimates that all wage costs will increase 4.6% this year and all other costs of purchasing will increase 2.1%. a. What are the total estimated purchasing costs for this year? b. If the same number of purchase orders is issued this year as last year, what is the estimated cost per purchase order, to the nearest cent?

Zigwell Manufacturing spent an average of $18 per order to issue 30,000 purchase orders last year. Of the cost per order, 60% was related to office and warehouse wage costs, 21% to office costs, 6% to overhead, and 13% to warehouse costs, Zigwell estimates that all wage costs will increase 4.6% this year and all other costs of purchasing will increase 2.1%. a. What are the total estimated purchasing costs for this year? b. If the same number of purchase orders is issued this year as last year, what is the estimated cost per purchase order, to the nearest cent?

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter6: Activity-based, Variable, And Absorption Costing

Section: Chapter Questions

Problem 1PB: Bobcat uses a traditional cost system and estimates next years overhead will be $800.000, as driven...

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