Brief exercise 18-12 spin cycle architecture uses three activity pools to apply overhead to its projects. each activity has a cost driver used to allocate the overhead costs to the projects. the activities and related overhead costs are as follows: initial concept formation $40,000; design $300,000; and construction oversight $100,000. the cost drivers and expected use are as follows. activities cost drivers expected use of cost drivers per activity initial concept formation number of project changes 20 design square feet 150,000 construction oversight number of months 100 (a) compute the predetermined overhead rate for each activity. (round overhead rate per square foot to 2 decimal places, e. g. 2.25 and all other answers to 0 decimal places, e. g. 1,225.) overhead rate initial concept formation $ per project change design $ per square foot construction oversight $ per month (b) classify each of these activities as unit-level, batch-level, product-level, or facility-level. activities level initial concept formation design construction oversight

You are the manager in charge of global operations at bankglobal – a large commercial bank that operates in a number of countries around the world. you must decide whether or not to launch a new advertising campaign in the u. s. market. your accounting department has provided the accompanying statement, which summarizes the financial impact of the advertising campaign on u. s. operations. in addition, you recently received a call from a colleague in charge of foreign operations, and she indicated that her unit would lose $8 million if the u. s. advertising campaign were launched. your goal is to maximize bankglobal’s value. should you launch the new campaign? explain. pre-advertising campaign post-advertising campaign total revenues $18,610,900 $31,980,200 variable cost tv airtime 5,750,350 8,610,400 ad development labor 1,960,580 3,102,450 total variable costs 7,710,930 11,712,850 direct fixed cost depreciation – computer equipment 1,500,000 1,500,000 total direct fixed cost 1,500,000 1,500,000 indirect fixed cost managerial salaries 8,458,100 8,458,100 office supplies 2,003,500 2,003,500 total indirect fixed cost $10,461,600 $10,461,600