ABC Action Analysis Appendix 6A PowerPoint Authors: Susan

ABC Action Analysis Appendix 6A PowerPoint Authors: Susan

ABC Action Analysis Appendix 6A PowerPoint Authors: Susan Coomer Galbreath, Ph.D., CPA Charles W. Caldwell, D.B.A., CMA Jon A. Booker, Ph.D., CPA, CIA Cynthia J. Rooney, Ph.D., CPA Copyright 2014 by The McGraw-Hill Companies, Inc. All rights reserved. 6A-2 Learning Objective 6-6 (Appendix 6A) Prepare an action analysis report using

activity-based costing data and interpret the report. 6A-3 Appendix 6A: ABC Action Analysis Conventional ABC analysis does not identify potentially relevant costs. An action analysis report helps because it: Shows what costs have been assigned to a cost object. Indicates how difficult it would be to adjust those costs in response to changes in the level of activity.

6A-4 Appendix 6A: ABC Action Analysis Constructing an action analysis report begins with the first-stage allocation process. In addition to computing an overall activity rate for each activity cost pool, an activity rate is computed for each type of overhead cost that is consumed supporting a given activity. Lets revisit the stage-one allocations from the Baxter Battery Company example that we discussed earlier.

6A-5 Appendix 6A: ABC Action Analysis $1,800,000 10,000 orders = $180 per order Other entries in the table are computed similarly. 6A-6 $180 per order 4,000 orders = $720,000 Other entries in the table are computed similarly. 6A-7 $180 per order 6,000 orders = $1,080,000

Other entries in the table are computed similarly. 6A-8 Appendix 6A: ABC Action Analysis Next, label each cost using an ease of adjustment code: Green costs adjust more or less automatically to changes in activity level without any action by managers. Yellow costs can be adjusted to changes in activity level, but it would require management action to realize the change in cost. Red costs can be adjusted to changes in activity level only with a great deal of difficulty and with

management intervention. 6A-9 Appendix 6A: ABC Action Analysis Action Analysis of LongLife Batteries Sales Green costs Direct materials Shipping costs Green margin $ $

18,700,000 $ 7,000,000 11,700,000 $ 11,222,000 478,000 $

1,610,000 (1,132,000) 6,000,000 1,000,000 Yellow costs Direct labor Indirect factory wages Factory utilities Administrative wages and salaries Office equipment depreciation Marketing wages and salaries Selling expenses Yellow margin

5,000,000 3,360,000 850,000 1,280,000 252,000 420,000 60,000 Red costs Factory equipment depreciation Factory building lease Administrative building lease Red margin

1,610,000 - 6A-10 End of Appendix 6A

Recently Viewed Presentations

  • Wilce Student Health Center CODING 101 Evaluation and

    Wilce Student Health Center CODING 101 Evaluation and

    E&M codes used in scenarios are for illustrative purposes. E&M codes selected must be supported by documentation in chart note. Coding practices may vary between institutions. Work with your Compliance Office and Administration to ensure coding practices fall within applicable...
  • Global Justice Education Upside Down World NUIG DE

    Global Justice Education Upside Down World NUIG DE

    We live within "a system of transformation and of self-expansion. In order to pursue the [mythical] goal of endless growth, it must constantly seek out new sites of accumulation, and commodify forms of social activity and processes that previously existed...
  • AP Biology - images.pcmac.org

    AP Biology - images.pcmac.org

    AP Biology Life's Beginnings on Earth according to science Nucleic Acid Formation Amino Acid Formation Protein's Natural Form Monosaccharides Combining Phospholipid Formation Construction of mRNA from DNA Constructing Chromosomes DNA Replicating - Hydrophilic head Hydrophobic tail WATER WATER Membrane Formation...
  • Commonsense Knowledge Acquisition and Applications Towards Commonsense Enriched

    Commonsense Knowledge Acquisition and Applications Towards Commonsense Enriched

    This is a new Transductive setting because previous transductive settings would only have relationship between triples. By having graphs for parts of triples, we can generalize by first going to abstract level (domain and range) in order to prune the...
  • 8TH ANNUAL MCGILL CONFERENCE ON INTERNATIONAL AVIATION LIABILITY

    8TH ANNUAL MCGILL CONFERENCE ON INTERNATIONAL AVIATION LIABILITY

    1973 Hague Convention: in force in 11 European countries (Croatia, Finland, France, Luxembourg, Macedonia, Montenegro, the Netherlands, Norway, Serbia, Slovenia and Spain). Rome II . Regulation: in force within the EU (exceptDenmark) and applicable for eventsgivingrise to damage whichoccuredafterJanuary 11,...
  • COLLISION INDUCED ROTATIONAL ENERGY TRANSFER IN FS COHERENT

    COLLISION INDUCED ROTATIONAL ENERGY TRANSFER IN FS COHERENT

    Times New Roman Arial Wingdings Symbol Comic Sans MS Default Design Microsoft Equation 3.0 CorelDRAW 11.0 Graphic CorelDRAW 9.0 Graphic Microsoft Word Document Slide 1 Slide 2 Motivation Collision-induced line broadening (inverse Raman spectroscopy) CARS (Coherent anti-Stokes Raman Scattering) Slide...
  • Заголовок слайда отсутствует

    Заголовок слайда отсутствует

    New Variants of Old Diseases On a November night in 1951 in England, I saw many young men from a nearby US Army Airforce base, who all together collapsed some hours after eating a turkey cooked in the USA, and...
  • Αξιοπιστία Εργαστηριακού Αποτελέσματος.

    Αξιοπιστία Εργαστηριακού Αποτελέσματος.

    Χάρτες Levey-Jennings Τα κριτήρια ελέγχου Westgard Τα κριτήρια ελέγχου Westgard ερμηνεύουν με τον καλύτερο τρόπο την διακύμανση των σημείων ελέγχου πάνω σε ένα διάγραμμα Levey-Jennings.