Question 4 35 Barbacoa As Chinese Supplier Is A Traditional Manufacturing Company That Produces And Sells Two Types 1 (110.27 KiB) Viewed 33 times
Question 4 35 Barbacoa As Chinese Supplier Is A Traditional Manufacturing Company That Produces And Sells Two Types 2 (170.25 KiB) Viewed 33 times
Question 4 35 Barbacoa As Chinese Supplier Is A Traditional Manufacturing Company That Produces And Sells Two Types 3 (106.22 KiB) Viewed 33 times
Question 4 (35%) Barbacoa AS' Chinese supplier is a traditional manufacturing company that produces and sells two types of barbeque grills, the coal-driven Baconizer and the gas-driven Taste Master. It is only the latter that is imported to Norway. The company has previously used a costing model, where indirect production costs have been allocated to the two products with the help of a distribution rate where production time has been defined as the underlying cost driver. Their newly employed CFO wants to introduce Activity-based costing and has made an analysis of the budgeted indirect production costs for 2022 (all figures in Chinese Yuan): Total activity costs Fixed costs in % Activity 4 6 200 000 6 90.00 % Procurement Machinery set-up and calibration 4 4 800 000 100.00 % Available capacity 4 000 purchase orders 800 production lines 22 000 production hours 800 inspections 1 200 service jobs Budgeted capacity Budgeted capacity utilization utilization Baconizer Taste Master 1 800 1 400 purchase orders purchase orders 400 300 production lines production lines 8 000 10 400 production production hours hours 240 420 inspections inspections 400 540 service jobs service jobs 6 400 000 82.00% Production Quality inspections Maintenance of equipment 3 600 000 88.00% 3 000 000 74.00 % Facility costs 8 000 000 84.00% N/A N/A N/A Total 32 000 000 The direct production costs per unit are as follows: Direct material Direct labor Packaging Total Baconizer Taste Master 52.00 106.00 104.00 212.00 36.00 42.00 192.00 360.00 The planned production and sales in 2022 is: Baconizer: 120 000 units Taste Master: 240 000 units . Use the template in the Excel spreadsheet to make an ABC-costing model for one unit of Baconizer and one unit of TasteMaster, as well as a calculation of the costs for excess capacity in the Production Department.
Variable Fixed per purchase order per production line per production hour per inspection job per service job Baconizer Taste Master 0.00 0.00 66 Activity-based costing model: 67 68 Calculation of activity rates: 69 70 Procurement 71 Machinery set-up and calibration 72 Production costs 73 Quality inspection 74 Maintenance of equipment 75 Facility costs 76 77 Product costing: 78 79 Direct material 80 Direct labor 81 Packaging 82 Total direct costs per unit 83 84 Procurement costs, variable 85 Procurement costs, fixed 86 Machinery set-up and calibration, variable 87 Machinery set-up and calibration, fixed 88 Production costs, variable 89 Production costs, fixed 90 Quality inspections, variable 91 Quality inspections, fixed 92 Maintenance of equipment, variable 93 Maintenance of equipment, fixed 94 Facility costs, variable 95 Facility costs, fixed 96 Total indirect costs per unit 97 Total ABC-costs per unit 98 99 Costs for excess capacity: 100 101 Procurement 102 Machinery set-up and calibration 0.00 0.00 0.00 0.00
B D E F А 88 Production costs, variable 89 Production costs, fixed 90 Quality inspections, variable 91 Quality inspections, fixed 92 Maintenance of equipment, variable 93 Maintenance of equipment, fixed 94 Facility costs, variable 95 Facility costs, fixed 96 Total indirect costs per unit 97 Total ABC-costs per unit 98 99 Costs for excess capacity: 0.00 0.00 0.00 0.00 100 101 Procurement 102 Machinery set-up and calibration 103 Production costs 104 Quality inspections 105 Maintenance of equipment 106 Facility costs 107 Total costs for excess capacity 108 Total costs for utlized capacity 109 Total indirect production costs
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