Homework Answers
| Computation of Customer Margin | ||
| Under ABC Costing | ||
| Std Model | Custom Design | |
| No. of Unit | 10 | 3 |
| Sales @11600, @ 14200 (a) | $116,000.00 | $42,600.00 |
| Cost | ||
| Direct
Material @8450, $9340 |
$84,500.00 | $28,020.00 |
| Direct
Labour (23.50*10*20) (23*3*20) |
$4,700.00 | $1,380.00 |
| Supporting Manufacturing | $7,520.00 | $2,208.00 |
| Order Processing | $606.00 | $606.00 |
| Customer Designing | $726.00 | |
| Customer Services | $317.00 | $317.00 |
| Total Cost (b) | $97,643.00 | $33,257.00 |
| Net Margin (a-b) | $18,357.00 | $9,343.00 |
| Assigning Overhead Cost Product Model | ||||||||
| Using ABC Method | ||||||||
| Standard Model | Custom Design | |||||||
|
Activity Based Overhead Rate (A) |
Cost Driver Incurred (B) |
OH Allocated (AXB) |
Cost Driver Incurred ( C) |
OH Allocated (AXC) |
||||
| Supporting Manufacturing | $32.00 | per DLH | 235 | (23.50*10) Hour | $7,520.00 | 69 | (3*23)Hour | $2,208.00 |
| Order processing | $202.00 | Per Order | 3 | Order | $606.00 | 3 | Order | $606.00 |
| Custom Design | $242.00 | Per Custom Design | 0 | Custom Design | $0.00 | 3 | Custom Design | $726.00 |
| Customer Servcies | 317 | Per Customer | 1 | Customer | $317.00 | 1 | Customer | $317.00 |
| Total Overhead | $8,443.00 | $3,857.00 | ||||||
| No. Of Watercraft | 10 | 3 | ||||||
| Overhead per Water craft | $844.30 | $1,285.67 | ||||||
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