Question

Consumption Ratios Zapato Company produces two types of boots: vaquero and vaquera. There are four activities associated with the two products. Drivers for the four activities are as follows: Vaquero Vaquera Cutting hours 2,190 5,400 Assembly hours 2,850 4,650 Inspection hours 940 2,430 Rework hours 150 450 Required: Calculate the consumption ratios for the four drivers. Round your answers to two decimal places.

Answer 1

The consumption ratios for Zapato Company's driver activities are calculated by summing the driver hours for both boots and then dividing each product’s hours by the total to find the ratio per activity.

Step-by-step explanation:

To calculate the consumption ratios for Zapato Company's two products for each activity, we first add the respective driver hours for both products. Then, we divide each type of boot's driver hours by the total hours to get the ratio for that boot as it relates to the specific driver. The calculation for each driver is as follows:

Cutting hours consumption ratio: Vaquero = 2,190 / (2,190 + 5,400) and Vaquera = 5,400 / (2,190 + 5,400)

Assembly hours consumption ratio: Vaquero = 2,850 / (2,850 + 4,650) and Vaquera = 4,650 / (2,850 + 4,650)

Inspection hours consumption ratio: Vaquero = 940 / (940 + 2,430) and Vaquera = 2,430 / (940 + 2,430)

Rework hours consumption ratio: Vaquero = 150 / (150 + 450) and Vaquera = 450 / (150 + 450)

Each ratio represents the proportion of activity consumed by each product type.

Answer 2

Step-by-step explanation:

The formula to compute the consumption ratio is shown below:

Consumption ratio = Activity driver amount ÷ Total amount of activity driver

For Cutting hours

Vaquero = ($2,190) ÷ ($2,190 + $5,400)

= ($2,190) ÷ ($7,590)

= 0.29

Vaquera = ($5,400) ÷ ($2,190 + $5,400)

= ($5,400) ÷ ($7,590)

= 0.71

For Assembly hours

Vaquero = ($2,850) ÷ ($2,850 + $4,650)

= ($2,850) ÷ ($7,500)

= 0.38

Vaquera = ($4,650) ÷ ($2,850 + $4,650)

= ($4,650) ÷ ($7,500)

= 0.62

For Inspection Hours

Vaquero = ($940) ÷ ($940 + $2,430)

= ($940) ÷ ($3,370)

= 0.28

Vaquera = ($2,430) ÷ ($940 + $2,430)

= ($2,430) ÷ ($3,370)

= 0.72

For Rework hours

Vaquero = ($150) ÷ ($150 + $450)

= ($150) ÷ ($600)

= 0.25

Vaquera = ($450) ÷ ($150 + $450)

= ($450) ÷ ($600)

= 0.75