[chiranjeev]

I got 46 marks in first attempt really feeling v.sad about it. After graduation in 2012 it was my first exam to attempt.

[chiranjeev]

Hi I would like to ask one thing in ABC method,

What if we are provided with the ‘revenue’ and ‘cost of products sold’ in items, how we have to tackle such situations?

For Example:-

Items Soft Drinks Fresh Produce Packaged food
Revenues 425,800 756,250 443,280
Cost of product sold 262,500 467,500 270,000
Cost of empty bottles returned 6,800 0 0
No. of purchase orders placed 315 285 210
No. of deliveries received 420 570 525
Hours of shelf stocking time 250 1,425 1,050
Number of product sold 63,000 285,000 105,000

Activity Total Cost Cost-Allocation Basis
Bottle returns 6,800 Direct tracing to soft-drink line
Ordering 81,000 810 Purchases orders
Delivery 106,050 1,515 Deliveries
Shelf-stocking 55,875 2725 hours of shelf stocking time
Customer 135,900 453,000 items sold
Support

Total 385,625

How we will calculate costing on traditional basis and ABC basis and also we have to calculate operating income and the operating income as percentage of revenues for each product line?

[Author]

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