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C025 Dealer account 025 Dealer

Revenue150,970
Direct margin52,754
Activity cost54,462
ABC profit-1,708 (-1.1%)
Traditional profit25,998

hidden loser Traditional costing assigns 26,756 of overhead from 957 labour hours; ABC assigns 54,462.

Profit waterfall

-50,000050,000100,000150,000200,000 Revenue: 150,970 150,970 RevenueDirect cost: -98,216 -98,216 Direct costDirect margin: 52,754 52,754 Direct marginEngineering changes: -11,874 -11,874 Engineering changesSetups: -9,753 -9,753 SetupsDelivery: -7,071 -7,071 DeliveryMachine run: -5,374 -5,374 Machine runCustom finishing: -5,143 -5,143 Custom finishingQuality inspection: -5,104 -5,104 Quality inspectionOther activities: -10,143 -10,143 Other activitiesProfit: -1,708 -1,708 Profit

Activity costs

ActivityCostShare
Engineering changes11,87422%
Setups9,75318%
Delivery7,07113%
Machine run5,37410%
Custom finishing5,1439%
Quality inspection5,1049%
Order processing3,2776%
Hand assembly2,9255%
Pallet handling1,6773%
Customer support1,4233%
Credit and collections8412%
Returns handling00%