BU111 Lecture Notes - Lecture 5: W. M. Keck Observatory, Gross Margin, Profit Margin
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Midwest office products (a) multi-part items 1-4 below. (1) cost of processing cartons through facility: ,320,000 + ,000,000 = ,320,000: practical capacity, cost rate for supplying capacity. Assumption made by this calculation: all cartons place the same demands on warehouse resources. In this case, a warehouse person has to break open the carton, pick the desired quantity of materials, and then package them up to be shipped to the customer. Such breakpack quantities are far more expensive to process per unit than carton-sized quantities. All of these complexities can be handled by a slightly more complex abc model. (2) customer order entry: cost of resources performing order entry. ,000: capacity of order entry resources: 16 1,500 hours = /hour (or sh. 583/minute: assign costs based on use of resources. Entering a manual customer order: 0. 150 35 = G&s costs are excluded because we don"t have sufficient information to assign them analytically.
