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Activity Based Costing Chapter 1

Forums › Ask CIMA Tutor Forums › Ask CIMA P2 Tutor Forums › Activity Based Costing Chapter 1

  • This topic has 2 replies, 2 voices, and was last updated 5 years ago by Cath.
Viewing 3 posts - 1 through 3 (of 3 total)
  • Author
    Posts
  • August 24, 2017 at 7:31 am #403282
    nnipa
    Member
    • Topics: 2
    • Replies: 1
    • ☆

    How to calculate totals cost on original basis:

    Cost driver rates:
    Accounts preparation and
    advice
    Requesting missing
    information
    Issuing fee payment
    reminders
    Holding client meetings $60,000/250 meetings = $240 per
    Travelling to clients $40,000/10,000 miles = $4 per mile
    Client costs:
    $580,000/18,000 hours = $32.222 per
    hour
    $30,000/250 times = $120 per request
    $15,000/400 times = $37.50 per
    reminder
    meeting
    Accounts preparation and advice $32,222 $8,055 $10,955
    Requesting missing information $480 $1,200 $720
    Issuing fee payment reminders $75 $300 $375
    Holding client meetings $960 $240 $480
    Travelling to clients $600 $2,400 $0
    ––––––– ––––––– –––––––
    Total costs $34,337 $12,195 $12,530
    Total costs on original basis (*) $40,280 $10,070 $13,695
    Client fees – new basis (W1) $41,204 $14,634 $15,036
    Client fees – original basis $48,336 $12,084 $16,434
    Increase/(Decrease) $(7,132) $2,550 $(1,398)
    (*) $725,000/18,000 hours = $40.28 per hour

    August 25, 2017 at 10:10 am #403425
    nnipa
    Member
    • Topics: 2
    • Replies: 1
    • ☆

    I have got my answer.

    August 30, 2017 at 11:21 pm #404498
    Cath
    Member
    • Topics: 0
    • Replies: 423
    • ☆☆☆

    Great – thank you for letting me know.

  • Author
    Posts
Viewing 3 posts - 1 through 3 (of 3 total)
  • The topic ‘Activity Based Costing Chapter 1’ is closed to new replies.

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