Costs and Selling Price Material

Topics: Costs, Harshad number, Variable cost Pages: 2 (304 words) Published: October 12, 2014
Activities/Products

Impero
Escana
Driftwood
Set up costs: 12,200
Cost driver: number of set ups.
Total number of set ups: 5

(12,200/5) x 2
= 4,880

(12,200/5) x 2
= 4,880

(12,200/5) x 1
= 2,440

Purchasing and checking wood edging costs: 8,000
Cost driver: wood edging per cabinet
Total number of meter per wood edging: 8 meters

(8,000/8) x 4
= 4,000

(8,000/8) x 4
= 4,000

(8,000/8) x 0
= 0
Purchase of wood costs: 5,100
Cost driver: wood (meters) per cabinet
Total number of meter of wood: 40 meters

(5,100/40) x 15
= 1,912.5

(5,100/40) x 15
= 1,912.5

(5,100/40) x 10
= 1,275
Quality inspection of wood edging costs: 7,400
Cost driver: wood edging (meter) per cabinet
Total number of meter per wood edging: 8 meters

(7,400/8) x 4
= 3,700

(7,400/8) x 4
= 3,700

(7,400/8) x 0
= 0
Dispatch and transport costs: 12,000
Cost driver: number of dispatches
Total number of dispatches: 310

(12,000/310) x 40
= 1,548.3871

(12,000/310) x 120
= 4,645.16129

(12,000/310) x 150
= 5,806.45161

Administration and personnel costs: 27,600
Cost driver: labor hours per cabinet
Total number of labor hours: 120

(27,600/120) x 48
= 11,040
(27,600/120) x 40
= 9,200
(27,600/120) x 32
= 7,360

Total cost per cabinet

27,080.8871/40 units = 677.022178
28,337.6613/120 units =
236.147177
16,881.4516/150 units =
112.543011

Profit per cabinet
Selling price – material cost/cabinet – labor cost/cabinet - cost per cabinet = 780 – 160 - 240 – 677.022178 = - 297.022178 (loss)

Selling price – material cost/cabinet – labor cost/cabinet - cost per cabinet = 570 – 130 – 200 – 236.147177 = 3.852823 (profit) Selling price – material cost/cabinet – labor cost/cabinet - cost per cabinet = 450 – 100 – 160 – 112.543011 = 77.456989 (profit) Total profit for each product

- 297.022178 x 40
= - 11,880.8871
3.852823 x 120 = 462.33876

77.456989 x 150 = 11,618.5484
Total profit for all...
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Cost and Price Essay
  • Costs and Price Essay
  • Investment and Selling Price Essay
  • Statistics and Mean Selling Price Essay
  • Materials Cost Management and Control Research Paper
  • Costs and Relevant Price Elasticity Essay
  • the high cost of low prices Essay
  • Essay on Costs and Price

Become a StudyMode Member

Sign Up - It's Free