Leidenheimer Corporation manufactures small airplane propellers. Sales for year 2 totaled $1,600,000. Information regarding resources for the month follows. Resources Used Resources SuppliedParts management$56,000 $72,000 Energy 100,000 100,000 Quality inspections 86,000 101,000 Long-term labor 48,000 69,000 Short-term labor 43,000 58,000 Setups 141,000 200,000 Materials 320,000 320,000 Depreciation 120,000 200,000 Marketing 144,000 157,000 Customer service 24,000 37,000 Administrative 116,000 138,000 In addition, Leidenheimer spent $60,000 on 50 engineering changes with a cost-driver rate of $1,200 and $60,000 on 8 outside contracts with a cost driver rate of $7,500. Required: Management has requested that you do the following:a. Prepare a traditional income statement.b. Prepare an activity-based income statement. ### Cost Analysis Template#### Educational Resource**Categorize and manage costs effectively using this comprehensive cost analysis template. It is divided into four main sections: Unit Costs, Batch Costs, Product and Customer Sustaining Costs, and Capacity Sustaining Costs. Each section allows for a detailed breakdown of costs, ensuring accurate resource allocation and financial planning.**---**Table Outline:****1. Costs:****Unit Costs:**- Allows entry of various unit costs.- Columns include: - Resources Used - Resource Capacity - Resources Supplied - Cost Amount At the bottom of this section, total unit costs are calculated.---**Batch Costs:**- Allocate costs associated with batches.- Columns include: - Resources Used - Resource Capacity - Resources Supplied - Cost Amount A total batch cost is tallied at the bottom of this section.---**Product and Customer Sustaining Costs:**- Capture costs that sustain products and customer relationships.- Columns include: - Resources Used - Resource Capacity - Resources Supplied - Cost Amount The total for product and customer sustaining costs is summarized at the end of this section.---**Capacity Sustaining Costs:**- Reflect costs to maintain production capacity.- Columns include: - Resources Used - Resource Capacity - Resources Supplied - Cost Amount The total capacity sustaining costs are calculated at the bottom of this section.---**Total Costs:**- Summarizes all the costs (unit, batch, product and customer sustaining, and capacity sustaining costs) to give an overall cost figure.---**Instructions for Use:**1. **Input Costs:** - Enter specific cost details in the corresponding section (Unit, Batch, Product and Customer Sustaining, or Capacity Sustaining). - Ensure to fill in all applicable columns: Resources Used, Resource Capacity, Resources Supplied, and Cost Amount.2. **Calculate Totals:** - Verify each subtotal in the different sections. - The total line in each section automatically adds the inputs to provide a comprehensive cost overview.**Graphs/Diagrams Section Explanation:**- There are no graphs or diagrams included in this template. The structure relies entirely on a tabular format to break down and calculate costs.By utilizing this template, stakeholders can achieve a detailed, transparent view of costs at various production stages, ensuring more

a. Traditional Income Statement Particulars Amount Amount Sales $1,600,000 Parts…

Answered: Leidenheimer Corporation manufactures…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Leidenheimer Corporation manufactures small airplane propellers. Sales for year 2 totaled $1,600,000. Information regarding resources for the month follows.

	Resources Used		Resources Supplied
Parts management	$	56,000		$	72,000
Energy		100,000			100,000
Quality inspections		86,000			101,000
Long-term labor		48,000			69,000
Short-term labor		43,000			58,000
Setups		141,000			200,000
Materials		320,000			320,000
Depreciation		120,000			200,000
Marketing		144,000			157,000
Customer service		24,000			37,000
Administrative		116,000			138,000

In addition, Leidenheimer spent $60,000 on 50 engineering changes with a cost-driver rate of $1,200 and $60,000 on 8 outside contracts with a cost driver rate of $7,500.

Required:

Management has requested that you do the following:

a. Prepare a traditional income statement.

b. Prepare an activity-based income statement.

### Cost Analysis Template

#### Educational Resource

**Categorize and manage costs effectively using this comprehensive cost analysis template. It is divided into four main sections: Unit Costs, Batch Costs, Product and Customer Sustaining Costs, and Capacity Sustaining Costs. Each section allows for a detailed breakdown of costs, ensuring accurate resource allocation and financial planning.**

---

**Table Outline:**

**1. Costs:**

**Unit Costs:**
- Allows entry of various unit costs.
- Columns include:
- Resources Used
- Resource Capacity
- Resources Supplied
- Cost Amount

At the bottom of this section, total unit costs are calculated.

---

**Batch Costs:**
- Allocate costs associated with batches.
- Columns include:
- Resources Used
- Resource Capacity
- Resources Supplied
- Cost Amount

A total batch cost is tallied at the bottom of this section.

---

**Product and Customer Sustaining Costs:**
- Capture costs that sustain products and customer relationships.
- Columns include:
- Resources Used
- Resource Capacity
- Resources Supplied
- Cost Amount

The total for product and customer sustaining costs is summarized at the end of this section.

---

**Capacity Sustaining Costs:**
- Reflect costs to maintain production capacity.
- Columns include:
- Resources Used
- Resource Capacity
- Resources Supplied
- Cost Amount

The total capacity sustaining costs are calculated at the bottom of this section.

---

**Total Costs:**
- Summarizes all the costs (unit, batch, product and customer sustaining, and capacity sustaining costs) to give an overall cost figure.

---

**Instructions for Use:**
1. **Input Costs:**
- Enter specific cost details in the corresponding section (Unit, Batch, Product and Customer Sustaining, or Capacity Sustaining).
- Ensure to fill in all applicable columns: Resources Used, Resource Capacity, Resources Supplied, and Cost Amount.

2. **Calculate Totals:**
- Verify each subtotal in the different sections.
- The total line in each section automatically adds the inputs to provide a comprehensive cost overview.

**Graphs/Diagrams Section Explanation:**
- There are no graphs or diagrams included in this template. The structure relies entirely on a tabular format to break down and calculate costs.

By utilizing this template, stakeholders can achieve a detailed, transparent view of costs at various production stages, ensuring more

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