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(#peratin$ inco&e-Revenue)

1,3 555 ,17 555

Comparision

Traditional A!C

res. roduce 7,17% 0,60%

aca$ed ood 3,30% !,7%

Soft /rins 1,70% 10,7!%

Resource Cate$orisation

Soft Drink Fresh Produce

Revenue (%) 14,33 1,1!

Cost of Goods Sold (%) 20,00 0,00

"ottle Return Cost (%) 100,00 0,00

#rderin$ Costs (%) 23,0! 3,!

/eliver Costs (%) 4,2 64,2

Self Stocin$ Costs (%) 6,2 62,0

Custo&er Support Costs (%) !,20 71,!!

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Packaged Food Total!34600 1616000

3600000 12000000

10!0000 3600000

6!0000 1600000

14600 !16000

3,30 ,47

Cost allocation !ase Allocation "ate

624 purchase orders 1000 Per purchase orders

1260 deliveries !00 Per deliveries

200Per stocking hour

6,14,400 items sold 2 Per items sold

Packaged Food Total

!34600 1616000

3600000 12000000

0 !000

1000 62000

211200 100!000

216000 641200

2!00 122!!00

16000 1600000

23600 !16000

+.*- .*

3456 hours of self stockingtime

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,!4 555 ,3

Packaged Food

24,!

30,00

0,00

23,0!

20,4

31,2

14,42

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Total /istriution Cost

Total Cases of ri&iu& and Re$ular 8ine S.ipped

/istriution cost per case under e9istin$ sste&

/istriution Costs Re$ular

Total er Case

26000 10,6

Re$ular

articulars Total er Case

Deliver Costs

Rs, ! 9 2:0:000 1420000 !

rdering Costs

Rs, 600 9 10 orders 9 10 distriutors 60000 0,2

Promotion Costs

Rs, 16:000 9 10 distriutors 160:000 0,67

Total Costs 2:10:000 4

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:260:000

00000

10,6

re&iu&

Total er Case

170000 10,6

re&iu&

Total er Case

Rs, ! 9 1:60:000 12!0000 !

Rs, 600 9 20 orders 9 30 distriutors 360000 2,2

Rs, 16:000 ; 30 distriutors !0:000 3

2:120:000 13

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Activity

Activity Costs $

Machine setups 425,000

Purchase ordering 10,000Machining 6,000,000

Inspection 36,000

Packing and shipping 64,000

6,535,000

Activity

Activity Rate

Machine setups 65.38

Purchase ordering 100

Machining 80

Inspection 30

Packing and shipping 40

K33

Direct ateria! cost "30.00

Direct !a#or cost 24

$upport cost 8.3%

&nit cost "62.3%

The direct material cost and direct labor cost are obviousl much highe

!! result fro& t.e relative

The compan can consider the trade$offs in running !"" in larger

%unning larger batches &ould reduce the number of machine setup

The compan should reali'e, ho&ever, that such operational changes mi

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Activity Cost

Activity Practical Driver

Cost Driver Capacity Rate $

$etup hours 6,5006,3!

'u#er o( orders 100 100,00Machine hours %5,000 !0,00

'u#er o( #atches 1,200 30,00'u#er o( shipents 1,600 0,00

Cost Driver Units Cost A

)33 )88 )33

2,000 4,200 130%60

25 50 2500

40,000 15,000 3200000

400 600 12000

80 1,500 3200

*ota! 3,348,460

Per &nit 8.3%

K88

"45.00

60

10.38

"115.38

r for !"" than for !33#

sts are t.e sa&e per unit for ot. products: ut t.e ot.er support c

l lar$e nu&er of &ac.ine setups: purc.ase orders: inspe

batches and possibl maintaining larger inventories#

and inspections, and possibl the number of purchase orders#

ht not provide immediate financial improvements if capacit for these activities

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ssigned to

)88

2%45+6

5000

1200000

18000

60000

155%5+6

10.38

sts are t.ree to four ti&es .i$.er per unit for >!! t.an for >33,

ctions (atc.es):and s.ip&ents,

remains the same if not used profitabl#

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