Gg Toys

ACTG 512
GG Toys
Setup Templates

Estimation of Cost Driver Rates

Cost Pool Cost (from Exhibit 1) Allocation Base (from Exhibits 1 and 4) Cost Driver Rate (= Cost / Allocation Base)
Plant Management 40,000 27,000 $1.48
Machine Related 112,000 11,200 $10.00
Setup 13,333 160 $83.33
Receiving/Production Control 63,000 161 $391.30
Packaging and Shipping 53,000 350 $151.43

Product Cost Calculations – Chicago Plant (Based on March Production Data)

Geoffrey Doll Geoffrey Doll Specialty Branded Doll # 106 Specialty Branded Doll # 106 Total Per Doll (if produce 7,500) Total Per doll (if produce 4,000 )

Direct Materials (Exhibit 3) $375,000 $5 $24,000 $6
Direct Labor (Exhibit 3) 225,000 $3 15,000 $3.75
*Plant Management (33333 of 225K) 11,111 0.15 8,888.80 $2.22
*Machine Related ($xx per hr) 1,875 0.5 360 $0.3
*Setups (@ $xx.xx) 833.31 $83.33 8,333.13 $83.33
*Production Runs (@ $xxx) 3,913.04 $391.30 39,130.43 $391.30
*Shipments (@ $xxx.xx) 1,514.29 $151.43 33,314.29 $151.43
Total $619,246.64 $129,026.25
Sales Price $1,575,000 $21 $144,000 $36
Margin 61% ($955,753.36) 10% (14,973.35)

*(from Cost Driver Rates as calculated in top table)

Comparison of Cost Allocations

Old System New System Geoffrey Doll Specialty Branded Doll Geoffrey Doll Specialty Branded Dell

Unit:
DL Related (% of doll cost) 61.66% 22.24%
DM Related (% of doll cost) 37% 35.58%
Machine Related (% of doll cost) 0.31% 4.49% Total Unit Related (% of doll cost) 98.97% 62.32%

Batch:
Setup Related (% of doll cost) 0.14% 4.49%
Receiving Related (% of doll cost) 0.66% 21.10%
Shipping Related (% of doll cost) 0.25% 15.78% Total Batch Related (% of doll cost) 1.03% 41.37%

TOTAL: