1

1.00

COST POOLS/ACTIVITY

COSTS

Machine set up costs

280,000.00

Material ordering costs

316,000.00
Machine running costs
420,000.00
General facility costs
361,400.00
1,377,400.00
4

Production/overheads

Workings

Machine setups costs

Ordering costs
Machine runing costs
General costs
Total

(20000/500)*G3
(20000/500)*4*G4
(20000*1.5)*G5
(20000*1.5)*G6

4
20,000.00
97,391.30
105,333.33
155,940.59
134,183.17
492,848.39

Overhead costs per unit

24.64

Production costs per unit

Direct material costs
Direct labour costs
Direct expenses
PRIME COST
Overhead cost per unit
Total cost per unit

$
25.00
30.00
55.00
24.64
79.64

X
Direct Material cost
Direct labour cost
Direct expenses
Prime costs
OAR
Labour hours per unit
Overhead cost per unit

25.00
30.00
55.00
1377400/142000(w1)=9.70
30/12=2.5, 36/12=3, 24/12=2
2.5*9.7, 3*9.70, 2*9.7

24.25

Total cost per unit

79.25

Working 1
Total labour hours

X
20000*2.5, 16000*3, 22000*2

9.70

50,000.00

2.00
COST DRIVERS CALCULATIONS OF TOTAL COST DRIVERS
Number
of
batches
20000/500+16000/800+22000/400
Number
of
purchase orders
Number
of
machine hours
Number
of
machine hours

2.00

2
TOTAL DRIVERS
115

(20000/500)*4+(16000/800)*5+(22000/400)*4

480

20000*1.5+16000*1.25+22000*1.4

80800

20000*1.5+16000*1.25+22000*1.4

80800

16,000.00
48,695.65
65,833.33
103,960.40
89,455.45
307,944.83

22,000.00
133,913.04
144,833.33
160,099.01
137,761.39
576,606.77

19.25

26.21

$
28.00
36.00

22.00
24.00

64.00
19.25
83.25

46.00
26.21
72.21

Z
28.00
36.00
64.00

22.00
24.00
46.00

29.10

19.40

1,377,399.99

93.10

65.40

Z
48,000.00

Total
44,000.00

142,000.00

3.00
ABSORPTION
2434.78

658.33

5.20

4.47

0.01

280000

COST POOL/ACTIVITY

COST

COST DRIVER

Supervisor

90,000.00

Site visits

Planners

70,000.00

Planning docs

240,000.00

Labour hours

Property related
Total

Supervisitson cos
Planing costs
Property relatrd costs
Total overheads
Unit cost computation
Direct material cost
Direct labour cost
Direct expense
Prime cost
Overhead costs
Total cost per unit
Markup
Quoted pric

Direct material cost

Direct labour cost
Direct expenses
Prime cost
Overhead costs(w1)
Total cost per unit
Markup
Quoted price
Working 1
Overhead cots per unit
OAR
Labour hours per unit

400,000.00

1*F2
1*F3
300*F4

300*15

10260*50%

300*15

C37*50%

KX
180.00
280.00
1,800.00
2,260.00

3,500.00
4,500.00
8,000.00
2,260.00
10,260.00
5,130.00
15,390.00

KX
3,500.00
4,500.00
8,000.00
3,000.00
11,000.00
5,500.00
16,500.00
7%
KX

400000/40000 = 10
300.00

Overhead cots per unit

10*300, 10*500

3,000.00

DRIVER COMPUTATIONS

TOTAL DRIVERS
500.00

180

250.00

280

40,000.00

EX
1,080.00
1,400.00
3,000.00
5,480.00

6*F2
5*F3
500*F4

8,000.00
7,500.00

500*15
20980*50%

500*15
E37*50%

COST PER DRIVER

15,500.00
5,480.00
20,980.00
10,490.00
31,470.00

EX
8,000.00
7,500.00
15,500.00
5,000.00
20,500.00
10,250.00
30,750.00
-2%
EX
500.00

5,000.00

250

500

Expected production
Production runs

100*60+60*50=9000units
9000/900=10runs

Cost Pool

Cost (Tshs.) Cost driver

Production set-ups
Production testing
Component supply
Storage
Customer orders
Delivery

105,000,000 Set-ups
300,000,000 Tests
25,000,000 Component
orders
112,500,000 Customer
orders

Exected production

Number
of
drivers
300
1,500
500
1,000

350000
200000
50000
112500