In: Accounting
Leidenheimer Corporation manufactures small airplane propellers.
Sales for year 2 totaled $1,710,000. Information regarding
resources for the month follows.
Resources Used | Resources Supplied | ||||||
Parts management | $ | 65,000 | $ | 71,000 | |||
Energy | 101,000 | 101,000 | |||||
Quality inspections | 91,000 | 101,000 | |||||
Long-term labor | 49,000 | 70,000 | |||||
Short-term labor | 41,000 | 51,000 | |||||
Setups | 145,000 | 230,000 | |||||
Materials | 300,000 | 300,000 | |||||
Depreciation | 130,000 | 230,000 | |||||
Marketing | 133,000 | 168,000 | |||||
Customer service | 22,000 | 43,000 | |||||
Administrative | 119,000 | 139,000 | |||||
In addition, Leidenheimer spent $63,000 on 45 engineering changes
with a cost-driver rate of $1,400 and $59,200 on 8 outside
contracts with a cost driver rate of $7,400.
Required:
Management has requested that you do the following:
a. Prepare a traditional income statement.
b. Prepare an activity-based income statement.