ABKI348 - Cost Management Analysis Assessment 1 v2 2026 | The Career Academy NZ

ABKI348 - Cost Management Analysis Assessment

Read through the requirements below, and then complete all parts of the assessment and then save your work as either a Word document or a PDF file. Once you have saved your work click on the Assessment submission link within this topic and upload your completed assessment to your tutor for marking.

Part One - Activity Based Costing: ASR Limited

ASR Ltd manufactures specialised storage solutions for large items and items with unusual dimensions. Due to the specialised products most clients want to know the estimated price before they are produced. ASR Ltd has already been calculating direct costs by using an excel file to work out the total direct labour and materials costs that are involved. But they have been having issues with determining a reliable measure of the overhead applied.

In the past, the full manufacturing cost has been calculated by allocating overheads using a volume-based cost driver such as 20,000 direct labour hours per year. However, this was inaccurate as they found out they were undervaluing a lot of jobs in the previous year, reducing their profit. The directors of ASR Ltd has heard of a new way of applying overhead that uses cost pools and cost drivers. ASR Ltd has approached us to value the next big job for them.

Total Overhead

ASR Ltd found four categories of overheads. The first stage allocation (step 3) for next year are as follows: 

The Job ASR Ltd has been asked to submit a bid for a proposed job. The factory manager feels that obtaining this job would result in new business in future years. Usually bids are based upon cost of the job plus 30% mark-up. 

Estimates for the proposed job are as follows: