MANAGERIAL ACCOUNTING ACTIVITY BASED COSTING PRESENTED BY : MARK, RU JUN, VINCENT, XUE LI
E8.24 Wallaby Gully Wines is a small, family-run operation in the Yarra Valley. The winery produces two varieties of wine: Riesling and Chardonnay. Among the winery's activities are the following:Classify each of the activities listed as a unit, batch, product-sustaining or facility level activity.
Unit Level: Activity must be done on each unit produced Batch Level: Activity must be performed on each batch produced Product Sustaining Level: Activities needed to support an entire product Facility Level: Activity required in order for the production process to occur
E8.24 7. Harvesting: All of the grapes of both varieties are picked by hand to minimise damage. (product sustaining) 8. Stemming and crushing: Batches of grapes are hand-loaded into a machine, which gently removes the stems and crushes the grapes. (batch) 9. Pressing: After removal from the stemmer/crusher, the juice runs freely from the grapes. (batch) 10. Filtering: The grapes are crushed mechanically to obtain more juice from them. (batch) 11. Fermentation: The Riesling grape juice is placed in steel tanks for fermentation. The Chardonnay grape juice undergoes a two-stage fermentation process in oak barrels. (batch) 12. Ageing: The Riesling wines are aged in the steel tanks for about one year. The Chardonnays are aged in the oak barrels for about two years. (batch) 13. Bottling: A machine bottles the wine and corks the bottles. (unit)
E8.24 14. Labelling: Each bottle is manually labelled with the name of the vintner, vintage and variety. (unit) 15. Packing: The bottles are manually packed in 12 bottle cases. (batch) 16. Case labelling: The cases are hand-stamped with the same information given on the bottle labels. (batch) 17. Shipping: The wine is shipped to wine distributors and retailers, mainly in Sydney and Melbourne. Generally, about 100 cases are shipped at a time. (batch) 18. Maintenance on buildings: This is done during the slow winter months. (facility) 19. Maintenance on equipment: This is done when needed, and on a routine basis for preventative maintenance. (facility)
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