costalloc

← Channels

Retail chain

Revenue9,930,912
Direct margin3,037,867
Activity cost1,894,611
ABC profit1,143,255 (11.5%)
Traditional profit440,530

over-charged Traditional costing assigns 2,597,336 of overhead from 92,866 labour hours; ABC assigns 1,894,611.

Profit waterfall

02,000,0004,000,0006,000,0008,000,00010,000,000 Revenue: 9,930,912 9,930,912 RevenueDirect cost: -6,893,045 -6,893,045 Direct costDirect margin: 3,037,867 3,037,867 Direct marginMachine run: -443,161 -443,161 Machine runSetups: -355,909 -355,909 SetupsHand assembly: -283,908 -283,908 Hand assemblyQuality inspection: -264,027 -264,027 Quality inspectionPallet handling: -179,044 -179,044 Pallet handlingEngineering changes: -105,637 -105,637 Engineering changesOther activities: -262,926 -262,926 Other activitiesProfit: 1,143,255 1,143,255 Profit

Activity costs

ActivityCostShare
Machine run443,16123%
Setups355,90919%
Hand assembly283,90815%
Quality inspection264,02714%
Pallet handling179,0449%
Engineering changes105,6376%
Custom finishing98,9015%
Delivery60,8983%
Customer support48,4703%
Order processing37,7402%
Credit and collections9,6811%
Returns handling7,2360%