• DP World paid Cdn$676 million to buy the container port called Fairview
• DP World spent an additional Cdn$200 million for an expansion that readied Fairview to accept the largest vessels at sea
• DP World's total investment was Cdn$876 million ($676 million purchase price + $200 million expansion cost).
• Of the $876 million invested by DP World into the Fairview container port, 95 percent ($788.4 million) was invested in the loading/unloading department assets and 5 percent ($43.8 million) was invested in the container decontamination department assets.
• The total joint variable costs for loading/unloading in 2020 was $36.5 million.
• In 2020, the loading/unloading department for DP World's Prince Rupert facilities handled on average 3,600 of the 45-foot containers per day. In 2020, the container decontamination department for DP World's Prince Rupert facilities handled on average 400 of the 45-foot containers per day
• DP Worlds $200 million expansion readied Fairview to accept the largest vessels at sea, which are increasingly favored by shippers seeking to load more containers to reduce costs.
• The port variable overhead costs are allocated to the operating departments using the direct method.
• The costs for 2020 show the various rates related to the Fairview Container port as follows
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• DP World wanted to achieve an overall Return on Investment (ROI) of 14.50 percent (14.50%). Did they achieve it? In a written paragraph in a separate tab called Q4, inform management what the overall ROI was for 2020 in percentage form and in dollars. This should be a professionally written memorandum to Senior Management commenting on the overall achievementon-achievement of expected ROI.
• DP World is committed to boosting the terminals capacity by another third by 2022. In paragraph form in the tab called Q5, recommend to management what business department they should concentrate on to improve the bottom line. This should be a professionally written memorandum to Senior Management commenting on what they should focus on to improve the bottom line. Hint: think like a cost accountant. Why are we using the Variable Costing Income Statement Format? What does it highlight?

Support Departments Port Information Maintenance Services Operating Departments Loading / Container Unloading Decontamination Total Budgeted Port Variable Overhead costs before any interdepartmental cost allocations $9,000,000 $1,200,000 $9,975,000 $265,000 $20,440,000 Support Work Furnished by: Port Maintenance Budgeted labour hours Percentage Information Services Budgeted Computer Hours Percentage 116,800 20.0% 408,800 70.0% 58,400 10.0% 584,000 100.0% 3,650 10.0% 10,950 30.0% 21,900 60.0% 36,500 100.0% Support Departments Port Information Maintenance Services Operating Departments Loading / Container Unloading Decontamination Total Budgeted Port Variable Overhead costs before any interdepartmental cost allocations $9,000,000 $1,200,000 $9,975,000 $265,000 $20,440,000 Support Work Furnished by: Port Maintenance Budgeted labour hours Percentage Information Services Budgeted Computer Hours Percentage 116,800 20.0% 408,800 70.0% 58,400 10.0% 584,000 100.0% 3,650 10.0% 10,950 30.0% 21,900 60.0% 36,500 100.0%