Krupetskiy_chapter4

Krupetskiy_chapter4 - 4.39 Activity/Resource Tax Charge...

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Unformatted text preview: 4.39 Activity/Resource Tax Charge rate (price) $200.00 Labor hours worked 1,300 Secretarial support $160,000 72 Supplies 80,000 200 Computer costs 60,000 1,000 Total overhead $300,000 Comparative Profitability Reports a. ABC (Costs traced to products by activities) Supplies rate $160.00 per transaction Computer cost rate $37.50 per computer hou Secretarial support rate $1,333.33 per client Operating profit Tax Consulting Revenues $260,000 $540,000 Less Expenses other than DL Secretarial support 96,000 64,000 Supplies 32,000 48,000 Computer costs 37,500 22,500 Total expenses 165,500 134,500 Operating profit before DL cost $94,500 $405,500 Profit per labor hour $72.69 $150.19 b. Traditional (Direct-labor based) costing analysis Labor-based overhead rate per direct labor hour Operating profit Tax Consulting Revenues $260,000 $540,000 Less Expenses other than DL 97,500 202,500 Operating profit before DL cost $162,500 $337,500 Profit per labor hour $125.00 $125.00 Extra: Reconciliation of overhead costs ABC Traditional Total overhead activity costs $300,000 $300,000 Overhead cost traced or applied 300,000 300,000 Under (over) applied overhead $- $- Consulting Total activity $200.00 per hour 2,700 4,000 labor hours 48 120 clients 300 500 transactions 600 1,600 computer hours ur Total ### 160,000 80,000 60,000 300,000 ### $125.00 $75.00 Total ### 300,000 ### $125.00 fhampel: Recommendations for analysis: 1. All of the blue-filled cells are data input from the problem statement and table. Only change these numbers if you wan change the problem or to perform "what if" analysis. 2. The unfilled cells contain formulas that calculate cell out using the data input or previous calculations. The solutions repeat data input as numerical parts of formulas because thi increases the opportunities for errors and b) reduces the flex of the analysis. That is, each time a data input is changed (s #1), you would have to find each use of that data input and it. This is cumbersome and prone to error, especially with l more complex models. fhampel: Type your answers to parts c and d here: c. D. em nt to tcomes s never his a) exibility (see point d change larger, 4.41 Order processing $30,000 Production setup 120,000 Material handling 100,000 Machine depreciation & maintenance 80,000 Quality control 20,000 Packing 40,000 Total overhead $390,000 Direct labor hours Direct labor cost Number of units produced 20,000 Direct material costs $13,000 Direct labor hours 150 Orders 4 Production runs 1 Pounds of material used 5,000 Machine hours 580 Inspections 1 Units shipped 20,000 Comparative Costing Analyses b. Traditional (Direct-labor based) costing analysis Direct labor based overhead rate $78 Direct material costs $13,000 Direct labor costs 2,250 Manufacturing overhead 11,700 Total production costs applied $26,950 Annual Activity/Resource Estimated Cost January Actual activities/resources Unleaded Glass Unleaded Glass c. ABC (Costs traced to products by activities) Direct material costs...
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This note was uploaded on 11/11/2009 for the course ACC 211 taught by Professor Weber during the Spring '09 term at Colorado Mountain.

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Krupetskiy_chapter4 - 4.39 Activity/Resource Tax Charge...

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