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Classic Pen Co.: Developing an ABC Model Harvard Business...

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Accounting

Classic Pen Co.: Developing an ABC Model
Harvard Business School Case #103-015
Case Software # XLS-666- Classic Pen Company: Developing an ABC Model
1. Based on the activity information collected by Dempsey determine the Overhead applied to each product under ABC cost model by
a. Identifying the activities under the ABC model presented
b. Determining the total cost per activity under the ABC model presented
c. Determine the cost-driver for each activity
d. Determine the $ rate per cost driver unit identified in (c)
e. Calculate the overhead for each of the four products
2. Prepare a new income statement based on ABC overhead costs for each of the four products.

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