Question

Leidenheimer Corporation manufactures small airplane propellers. Sales for year 2 totaled $1,710,000. Information regarding resources for the month follows 0 $ 59,000 105,000 89,000 54,000 41,000 143.000 300,000 120,000 148,000 23,000 117,000 S 75,000 105,000 107,000 67,000 57,000 220,000 300,000 220,000 163,000 41,000 41,000 Parts management Quality inspections Long-term labor Short-term labor Customer service Administrative In addition, Leidenheimer spent $50,000 on 50 engineering changes with a cost-driver rate of $1,000 and $60,000 on 8 outside contracts with a cost driver rate of $7,500 5

Answer 1

TRADITIONAL INCOME STATEMENT
Sales		$ 1,710,000.00
Parts Management	$        75,000.00
Energy	$      105,000.00
Quality Inspection	$      107,000.00
Long term labour	$        67,000.00
Short term labour	$        57,000.00
Setups	$      220,000.00
Material	$      300,000.00
depreciation	$      220,000.00
Marketing	$      163,000.00
Customer Service	$        41,000.00
Administrative	$      141,000.00
Engineering Changes	$        50,000.00
Outside Cntracts	$        60,000.00
Total Cost		$ 1,606,000.00
Operating Profit		$      104,000.00
ACTIVITY BASED INCOME STATEMENT
Sales					$ 1,710,000.00
	Resources Used	Unused Resource Capacity	Resources Supplied
Units
Parts Management	$        59,000.00	$        16,000.00	$        75,000.00
Energy	$      105,000.00	$                       -	$      105,000.00
Short term labour	$        41,000.00	$        16,000.00	$        57,000.00
Material	$      300,000.00	$                       -	$      300,000.00
Outside Cntracts	$        60,000.00	$                       -	$        60,000.00
	$      565,000.00	$        32,000.00	$      597,000.00
Batch
Quality Inspection	$        89,000.00	$        18,000.00	$      107,000.00
Setups	$      143,000.00	$        77,000.00	$      220,000.00
	$      232,000.00	$        95,000.00	$      327,000.00
Product and Customer Sustaining
Marketing	$      148,000.00	$        15,000.00	$      163,000.00
Customer Service	$        23,000.00	$        18,000.00	$        41,000.00
Engineering Changes	$        50,000.00	$                       -	$        50,000.00
	$      221,000.00	$        33,000.00	$      254,000.00
Capacity Sustaining
Long term labour	$        54,000.00	$        13,000.00	$        67,000.00
depreciation	$      120,000.00	$      100,000.00	$      220,000.00
Administrative	$      117,000.00	$        24,000.00	$      141,000.00
	$      291,000.00	$      137,000.00	$      428,000.00
Total Cost	$ 1,309,000.00	$      297,000.00	$ 1,606,000.00		$ 1,606,000.00
Operating Profit					$      104,000.00