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please provide solution by excel operation and working process 8 9 10 11 12 13 14 15 16 create the Spreadsheets to compare traditional costing
please provide solution by excel operation and working process
8 9 10 11 12 13 14 15 16 create the Spreadsheets to compare traditional costing versus activity-based costing. Use the results to answer questions about the findings. Suppose Sunstar Corporation is one of Dell's circuit board suppliers. Sunstar currently uses traditional costing for making business decisions, where the direct costs are only a cost driver to allocate all the indirect production costs. At the urging of Dell, however, the company had decided to move to activity-based costing for circuit board production related to products PCB124 and PCB136. As one of the company's manager,you have been asked to prepare a spreadsheet comparing the two costing methods for the next company board meeting. Your supervisor has given you the following quarterly data: Table 1. Sales & Costs in quarter Sales Direct Costs (materials, labor) All Indirect Production Cost All Unallocated Value Chain Cost Total($) 1,500,000 340,640 1,060,000 100,000 PCB124 700,000 162,400 PCB136 800,000 178,240 17 18 19 20 21 22 23 24 Requirement 1. Construct Income Statement and calculate gross profit and gross profit margh for each product based on Traditional Cost Alocation System. Sunstar Corp Income Statement by Traditional Alocation System Total PCB124 PCB136 25 26 27 28 29 30 31 32 33 34 35 36 37 38 20 39 40 41 42 43 Requirement 2. Construct Income Statement and calculate gross profit and gross profit margh for each product based on Activity-Based Costhg Alocation System. Table 2. Indirect Production Cost by activities Assembly activity Soldering activity Inspection activity Total ($) 630,000 270,000 160,000 1,060,000 44 45 46 47 48 49 50 Table 3. Indirect Production Cost Drivers by activities Machine hours for assembly activity (Hours) Number of units produced for soldering activity (#) Testing hours for inspection activity (Hours) Total 1,560 10,000 14,000 PCB124 480 6.000 6,000 PCB136 1,080 4,000 8,000 Sunstar Corp. Income Statemenby ABCA location System Total PCB124 PCB136 10 51 52 53 54 55 56 57 58 59 60 61 62 63 64 65 66 67 68 69 70 71 72 73 74 Requirements. (1) Exploh why the results offer significantly between the traditional system and ABC system. (2) Plan production and marketing strategy based on the results IndonStep by Step Solution
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