Cornerstone Exercise 12.1 (Algorithmic)
Value- and Non-Value-Added Cost Reporting
Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and storing goods. Receiving and assembly are necessary activities; expediting and storing goods are unnecessary. The following data pertain to the four activities for the year ending 2014 (actual price per unit of the activity driver is assumed to be equal to the standard price):
Activity Activity Driver SQ AQ SP
Receiving Receiving orders 7,200 19,500 $12
Assembly Labor hours 81,000 97,500 9
Expediting Orders expedited 0 6,500 29
Storing Number of units 0 13,000 4
Required:
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1. Prepare a cost report for the year ending 2014 that shows value-added costs, non-value-added costs, and total costs for each activity. If an amount is zero, enter "0".
Cicleta Manufacturing
Value and Non-Value-Added Cost Report
For the Year Ended 2014
Activity
Value-Added Costs
Non-Value-Added Costs
Total Costs
Receiving
$
$
$
Assembly
Expediting
Storing
Total
$
$
$
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