12.12 Target prices, target costs, activity-based costing. (25–30 min) 1 Pagnol-Carrelages’s operating income in 2011 is as follows Total for 250,000 tiles (1) Per unit (2) = (1) ÷ 250,000 Revenues (€4 × 250,000) Purchase cost of tiles (€3 × 250,000) Ordering costs (€50 × 500) Receiving and storage (€30 × 4,000) Shipping (€40 × 1,500) Fixed cost Total costs Operating income €1,000,000 750,000 25,000 120,000 60,000 40,000 955,000 €45,000 €4.00 3.00 0.10 0.48 0.24 0.16 3.82 €0.02 2 Price to retailers in 2012 is 95% of s price = 0.95 × €4 = €3.80; cost per tile in 2012 is 96% of s cost = 0.96 × €3 = €2.88. Pagnol-Carrelages’s operating income in 2012 is as follows
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