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P037 Atelier Shelf 5

Revenue82,480
Direct margin26,764
Activity cost57,709
ABC profit-30,946 (-37.5%)
Traditional profit21,538

hidden loser Traditional costing assigns 5,226 of overhead from 187 labour hours; ABC assigns 57,709.

Profit waterfall

-50,000-25,000025,00050,00075,000100,000 Revenue: 82,480 82,480 RevenueDirect cost: -55,716 -55,716 Direct costDirect margin: 26,764 26,764 Direct marginEngineering changes: -30,923 -30,923 Engineering changesSetups: -12,675 -12,675 SetupsQuality inspection: -6,206 -6,206 Quality inspectionCustom finishing: -6,047 -6,047 Custom finishingMachine run: -1,287 -1,287 Machine runHand assembly: -572 -572 Hand assemblyProfit: -30,946 -30,946 Profit

Activity costs

ActivityCostShare
Engineering changes30,92354%
Setups12,67522%
Quality inspection6,20611%
Custom finishing6,04710%
Machine run1,2872%
Hand assembly5721%