Prepare the revised set of cost estimates and profit center income statements using the Direct-Labor Hour Approach,
Question:
Prepare the revised set of cost estimates and profit center income statements using the Direct-Labor Hour Approach, Method 1 allocation. Here is the info
Income Statement in Millions
Total: Counter Sales Custom Cakes Restaurant Frozen
Total Revenue: 119,000 32,000 15,000 42,000 30,000
Materials 35,300 12,800 4,500 10,500 7,500
Marketing and Sales 2,610 10 100 1500 1000
Total Direct Costs 37,910 12,810 4,600 12,000 8,500
Revenue Less Direct Costs 81,090
Indirect Operating Expenses
General Overhead(occupancy, admin) 35,600
Production Staff 35,700
Delivery 9,520
Total Indirect Operating Exp 80,820
Income before profit center salaries 270
Profit Center Salaries 4
Net Income to Shareholders 266
Production Staff (Hours)
Total Counter Sales Custom Cakes Restaurant Sales Frozen
General Labor 900 200 110 310 280
Pastry Chefs 220 20 80 60 60
Culinary Art and Design 82 5 70 7 0
Total Direct Labor Hours 1202 225 260 377 340
General Overhead Resource Cost Pool Size of Pool Cost Driver
Facility costs (property tax, depreciation) 12,642 Square Feet of Space
Admin, purchasing, and sales support 5,676 Number of Purchase Orders
Utilities 17,282 Estimated kilowatt usage
Total 35,600
General Overhead Cost Driver. Total Counter Sales Custom Cakes Restaurant Frozen
Square Feet 30,000 16,976 7,820 2,602 2,602
# of purchase orders 164 64 38 31 31
Estimated Kilowatt Usage 662,700 375,000 127,000 82,750 77,950
Production Staff
General Laborers 24,990
Pastry Chefs 8,925
Culinary Art and Design 1,785
Total Production Staff 35,700
Delivery (Mileage) Total Counter Sales Custom Cakes Restaurant Frozen
16,274 4,800 2,750 3,200 5,524
Accounting
ISBN: 978-0324662962
23rd Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren