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Chapter_6_Applying_Excel.xls
Chapter 6: Applying Excel
Data
Manufacturing overhead $500,000
Selling and administrative overhead $300,000
Assembling
Units
Processing
Orders
Supporting
Customers
Other
Manufacturing overhead 50% 35% 5% 10%
Selling and administrative overhead 10% 45% 25% 20%
Total activity 1,000 250 100
units orders customers
OfficeMart orders:
Customers 1 customer
Orders 4 orders
Number of filing cabinets ordered in total 80 units
Selling price $595
Direct materials $180
Direct labor $50
Enter a formula into each of the cells marked with a ? below
Review Problem: Activity-Based Costing
Perform the first stage allocations
Assembling
Units
Processing
Orders
Supporting
Customers
Other Total
Manufacturing overhead ? ? ? ? ?
Selling and administrative overhead ? ? ? ? ?
Total cost ? ? ? ? ?
Compute the activity rates
Activity Cost Pools Total Cost
Assembling units ? ? units ? per unit
Processing orders ? ? orders ? per order
Supporting customers ? ? customers ? per customer
Compute the overhead cost attributable to the OfficeMart orders
Activity Cost Pools ABC Cost
Assembling units ? per unit ? units ?
Processing orders ? per order ? orders ?
Supporting customers ? per customer ? customer ?
Sales ?
Costs:
Direct materials ?
Direct labor ?
Unit-related overhead ?
Order-related overhead ?
Customer-related overhead ? ?
Customer margin ?
Manufacturing overhead ?
Total activity ? units
Manufacturing overhead per unit ? per unit
Total Activity
Activity Rate
Activity Rate
Activity
Determine the customer margin for the OfficeMart orders under Activity-Based Costing
Determine the product margin for the OfficeMart orders under a traditional cost system
Page 1
Chapter_6_Applying_Excel.xls
Sales ?
Costs:
Direct materials ?
Direct labor ?
Manufacturing overhead ? ?
Traditional costing product margin ?
Page 2
Manufacturing overhead per unit $500 per unit
