| Schedule 1 |
| | | Resource Cost Categories and Resource Drivers |
| | | Cost category | Cost | Resource driver |
| | | Wages | $6,750,000 | Number of employees |
| | | Building costs | $1,800,000 | Floor space |
| | | Depreciation | $1,200,000 | Machine hours |
| | | Consumables | $60,000 | Orders placed by centre |
| | | Energy | $252,000 | Kilowatt hours used |
| | | Other | $60,000 | Number of employees |
| | | Total | $10,122,000 |
| | | - All Wages Costs can be considered indirect costs for the purposes of this case.
- The current conventional approach to allocation of overheads is to use a plantwide rate. |
| | | - The current plantwide rate in use can be approximated by using the estimated annual number of units produced as the level of activity. |
| Schedule 2 |
| | | Resource drivers consumed by activity centres |
| Cost categories (resource drivers) | | | Wages | Building costs | Depreciation | Consumables | Energy | Other |
| Activity centres | | | (employees) | (m2) | (machine hours) | (orders) | (kilowatt hours) | (employees) |
| New Product Development | | | 3 | 300 | | 10 | 10000 | 3 |
| Sales and distribution | | | 12 | 600 | | 10 | 12000 | 12 |
| Inspecting | | | 2 | 600 | | 10 | 12000 | 2 |
| Pasteurizing | | | 30 | 1,200 | 4800 | 180 | 240000 | 30 |
| Culturing | | | 30 | 1,200 | 6000 | 120 | 360000 | 30 |
| Curing | | | 24 | 1,200 | 1200 | 180 | 240000 | 24 |
| Administration | | | 12 | 600 | | 20 | 10000 | 12 |
| Corporate management | | | 6 | 400 | | 10 | 10000 | 6 |
| Total quantity of resource drivers across all activity centres | | | 119 | 6,100 | 12000 | 540 | 894000 | 119 |
| * All Calculations to 4 decimal places |
| Schedule 3 |
| | | | Activities and resource drivers used - Inspecting |
| Activity | | | Percentage of labour time | Percentage of floor space | Percentage of orders placed |
| Inspect milk | | | 30% | 50% | 0% |
| Disposal of substandard milk | | | 10% | 10% | 30% |
| Move to pasteurizing room | | | 10% | 10% | 0% |
| Inspect finished products | | | 30% | 10% | 0% |
| Disposal of substandard product | | | 10% | 10% | 30% |
| Reports to Health Dept | | | 10% | 10% | 40% |
| Total | | | 100% | 100% | 100% |
| * All Calculations to 4 decimal places |
| | | There is no significant use of machinery (and therefore no depreciation) in this activity |
| | | In this activity centre, consumables are used by three activities in the proportions given, and energy (kw) is consumed by all activities in the same proportions to the allocated floor space. |
| Schedule 4 |
| List of activities |
| Activity | | | Activity cost | Activity driver | Annual quantity of activity driver |
| Corporate management | | | $340,336 | Assigned directly to products |
| Process receivables | | | | No. of invoices | 6,000 | invoices |
| Process payables | | | | No. of purchase orders | 3,000 | purchase orders |
| Production planning | | | | No. of production schedules | 1,200 | production schedules |
| Reports to Health Dept | | | ?? | No. of reports | 1,200 | reports |
| Process sales order | | | | No. of sales orders | 4,800 | sales orders |
| Dispatch sales order | | | | No. of dispatches | 3,000 | dispatches |
| New Product Development | | | $170,168 | Assigned directly to new products lines |
| Inspect milk | | | ?? | No. of batches | 1,200 | batches |
| Disposal of substandard milk | | | ?? | No. of batches | 1,200 | batches |
| Move to pasteurizing room | | | ?? | No. of batches | 1,200 | batches |
| Set up pasteurizer | | | | No. of batches | 1,200 | batches |
| Weigh and sort ingredients | | | | No. of batches | 1,200 | batches |
| Load pasteurizer | | | | No. of litres | 240,000 | litres |
| Operate pasteurizer | | | | No. of batches | 1,200 | batches |
| Unload and Clean pasteurizer | | | | No. of batches | 1,200 | batches |
| Move to culturing room | | | | No. of batches | 1,200 | batches |
| Set up scales | | | | No. of batches | 1,200 | batches |
| Weigh ingredients | | | | No. of batches | 1,200 | batches |
| Load culturing vats | | | | No. of batches | 1,200 | batches |
| Coagulate, Drain and Scald | | | | No. of litres | 240,000 | litres |
| Drain and clean vats | | | | No. of batches | 1,200 | batches |
| Move to curing room | | | | No. of litres | 240,000 | litres |
| Pack and pressing | | | | No. of products | 960,000 | products |
| Setup curing room | | | | No. of trays | 19,200 | trays |
| Move to curing room | | | | No. of trays | 19,200 | trays |
| Cure products | | | | No. of trays | 19,200 | trays |
| Unload curing room | | | | No. of trays | 19,200 | trays |
| Inspect finished products | | | ?? | No. of trays | 19,200 | trays |
| Disposal of substandard product | | | ?? | No. of trays | 19,200 | trays |
| Move to truck | | | | No. of trays | 18,240 | Finished trays |
| * All Calculations to 4 decimal places | | | | “??” indicates that these figures must be calculated. |
| Schedule 5 |
| Cheddar |
| Activities consumed | | | Annual quantity of activity driver |
| Corporate management | | | $93,065 | Assigned directly to products |
| Process receivables | | | 600 | invoices |
| Process payables | | | 200 | purchase orders |
| Production planning | | | 160 | production schedules |
| Reports to Health Dept | | | 160 | reports |
| Process sales order | | | 600 | sales orders |
| Dispatch sales order | | | 500 | dispatches |
| New Product Development | | | $0 | Assigned directly to new products lines |
| Inspect milk | | | 160 | batches |
| Disposal of substandard milk | | | 160 | batches |
| Move to pasteurizing room | | | 160 | batches |
| Set up pasteurizer | | | 160 | batches |
| Weigh and sort ingredients | | | 160 | batches |
| Load pasteurizer | | | 48,000 | litres |
| Operate pasteurizer | | | 160 | batches |
| Unload and Clean pasteurizer | | | 160 | batches |
| Move to culturing room | | | 160 | batches |
| Set up scales | | | 160 | batches |
| Weigh ingredients | | | 160 | batches |
| Load culturing vats | | | 160 | batches |
| Coagulate, Drain and Scald | | | 48,000 | litres |
| Drain and clean vats | | | 160 | batches |
| Move to curing room | | | 48,000 | litres |
| Pack and pressing | | | 192,000 | products |
| Setup curing room | | | 1,920 | trays |
| Move to curing room | | | 1,920 | trays |
| Cure products | | | 1,920 | trays |
| Unload curing room | | | 1,920 | trays |
| Inspect finished products | | | - | trays |
| Disposal of substandard product | | | - | trays |
| Move to truck | | | 1,920 | Finished trays |
| Direct Materials | | | $2 | per litre
Assigned directly to products |
| Current Market Selling Price | | | | per unit of product |
| Batch size | | | 1,200 |
| Annual Volume | | | 192,000 |
| * All Calculations to 4 decimal places |
| Schedule 6 |
| Mascarpone |
| Activities consumed | | | Annual quantity of activity driver |
| Corporate management | | | $11,148 | Assigned directly to products |
| Process receivables | | | 200 | invoices |
| Process payables | | | 100 | purchase orders |
| Production planning | | | 60 | production schedules |
| Reports to Health Dept | | | 60 | reports |
| Process sales order | | | 180 | sales orders |
| Dispatch sales order | | | 100 | dispatches |
| New Product Development | | | $87,165 | Assigned directly to new products lines |
| Inspect milk | | | 50 | batches |
| Disposal of substandard milk | | | 50 | batches |
| Move to pasteurizing room | | | 50 | batches |
| Set up pasteurizer | | | 50 | batches |
| Weigh and sort ingredients | | | 50 | batches |
| Load pasteurizer | | | 11,500 | litres |
| Operate pasteurizer | | | 50 | batches |
| Unload and Clean pasteurizer | | | 50 | batches |
| Move to culturing room | | | 50 | batches |
| Set up scales | | | 50 | batches |
| Weigh ingredients | | | 50 | batches |
| Load culturing vats | | | 50 | batches |
| Coagulate, Drain and Scald | | | 11,500 | litres |
| Drain and clean vats | | | 50 | batches |
| Move to curing room | | | 11,500 | litres |
| Pack and pressing | | | 24,000 | products |
| Setup curing room | | | 480 | trays |
| Move to curing room | | | 480 | trays |
| Cure products | | | 480 | trays |
| Unload curing room | | | 480 | trays |
| Inspect finished products | | | 480 | trays |
| Disposal of substandard product | | | 480 | trays |
| Move to truck | | | 460 | Finished trays |
| Direct Materials | | | $4 | per litre
Assigned directly to products |
| Current Market Selling Price | | | | per unit of product |
| Batch size | | | 500 |
| Annual Volume | | | 23,000 |
| * All Calculations to 4 decimal places |