Check Processing Centers

Billings Great Falls Clayton Total

Sales 20,000,000 18,000,000 12,000,000 50,000,000
Operating expenses:
Direct labor 12,500,000 11,000,000 8,500,000 32,000,000
Variable overhead 350,000 310,000 190,000 850,000
Equipment depreciation 1,300,000 1,400,000 1,200,000 3,900,000
Facility Expense 900,000 800,000 1,100,000 2,800,000
Local admin expense 140,000 160,000 150,000 450,000
Regional admin expense 600,000 540,000 360,000 1,500,000
Corporate admin expense 1,900,000 1,710,000 1,140,000 4,750,000
Total operating expenses 17,690,000 15,920,000 12,640,000 46,250,000
Net operating income 2,310,000 2,080,000 (640,000) 3,750,000

Direct labor per unit sold 0.625 0.611 0.708 0.640

Variable overhead per unit sold 0.018 0.017 0.016 0.017
Facility expense per unit sold 0.045 0.044 0.092 0.056
Local admin per unit sold 0.007 0.009 0.013 0.009
Regional admin per unit sold 0.030 0.03 0.03 0.03
Corporate admin per unit sold 0.095 0.095 0.095 0.095

Assumption: Volume from Clayton is split evenly between Billings and Great Falls and equipment is also split evenlly

Check Processing Centers

Billings Great Falls Clayton (write-off) Total without Clayton
Sales 26,000,000 24,000,000 - 50,000,000
Operating expenses:
Direct labor 16,250,000 14,666,667 - 30,916,667
Variable overhead 455,000 413,333 - 868,333
Equipment depreciation 1,900,000 2,000,000 - 3,900,000
Facility Expense 1,200,000 1,100,000 1,100,000 3,400,000
Local admin expense 182,000 213,333 - 395,333
Regional admin expense 780,000 720,000 - 1,500,000
Corporate admin expense 2,470,000 2,280,000 - 4,750,000
Total operating expenses 23,237,000 21,393,333 1,100,000 45,730,333
Net operating income 2,763,000 2,606,667 (1,100,000) 4,269,667

Clayton Rates
Sales 16,618,500
Operating expenses:
Direct labor 11,770,884 0.7083
Variable overhead 262,572 0.0158
Equipment depreciation 1,200,000
Facility Expense 1,100,000
 Local admin expense 207,731 0.0125
Regional admin expense 498,555 0.03
Corporate admin expense 1,578,758 0.095
Total operating expenses 16,618,500
Net operating income 0
 Billings
Direct Labor 12,500,000
Variable Overhead 350,000
Sales 20,000,000
Direct labor per $ of sale 0.625
Variable overhead per $ of sale 0.018

Billings
Local admin 140,000
Sales 17,690,000
Local admin per $ of sale 0.008

nt is also split evenlly

12000000 100
16621000 138.5083333
Current Difference
50,000,000 -

32,000,000 (1,083,333) favorable

850,000 18,333 unfavorable
3,900,000 -
2,800,000 600,000 unfavorable
450,000 (54,667) favorable
1,500,000 -
4,750,000 -
46,250,000 (519,667) favorable
3,750,000 519,667 favorable
Great Falls Clayton
11,000,000 8,500,000
310,000 190,000
18,000,000 12,000,000
0.611 0.708
0.017 0.016

Great Falls Clayton

160,000 150,000
15,920,000 12,000,000
0.010 0.013