1. © Baan Development BV Controlling 2 iBaan ERP 5.0c

2. 2 © Baan Development BV iBaan ERP Course Objective I The objective of this course is to The objective of this course is to lear n about the concepts and functionality of lear n about the concepts and functionality of Product Costing and Activity-based Product Costing and Activity-based Costing in iBaan ERP Finance, the Costing in iBaan ERP Finance, the link with the Cost Price Calculation of link with the Cost Price Calculation of an item, and the cost drivers in iBaan Logistics. an item, and the cost drivers in iBaan Logistics.

3. 3 © Baan Development BV nKnow module contents and links to other modules nKnow Cost Price Calculation procedures –Bill of Material –Cost Price Components –Operations nKnow Single Dimension Budgeting set up –Distributions –Budget defaults –Performance Budget + Single Dimension Budget nKnow Product Costing procedures –Iteration –Retrograde calculation –Integration with cost price calculation –Deviations nKnow Activity-based Costing procedures –Bill of Activities Finance iBaan ERP iBaan ERP Course Objective II

4. 4 © Baan Development BV Budget Cost pricing ABC iBaan ERP - Course Content nOverview FBS/CAT nCost Price Calculation (CPR) nProduct Costing nIntegration of logistic actuals (hours; cost drivers) nActivity-based Costing

5. 5 © Baan Development BV Central Invoicing Projects Service Quality Management Manufacturing Warehousing General Ledger Order Management Accounts Receivable Budgets Cost Accounting Financial Statements Fixed Assets Cash Management iBaan ERP Finance Purpose: Controlling is the coordination task of budgeting, auditing, and providing information to improve business procedures in organizations. Budgets Iteration Operation Rates and Surcharges Deviations Accounts Payable

6. 6 © Baan Development BV FBS/CAT in relation to iBaan ERP Finance ACR FAM Service TS Project TS Basic Data IBD EMM COM MCS Central Invoicing Logistics IBD TD IBD I TS TP GLD TI SLI FST ACP CAT FBS WH CMG

7. 7 © Baan Development BV Cost accounting Background n1970s: Kilger and Plaut developed highly structured and detailed approach to cost control: –through standard costs and flexible budgets –basic principles: cost centers are focal point for cost planning, cost control, and production costing clear distinction between fixed and variable costs nU.S. cost systems similar to these cost systems n1980s: –use of computers makes it possible to create more frequent reports displaying direct/indirect costs –activity based costing

8. 8 © Baan Development BV Cost accounting What is it? nProcess of determining cost of producing goods and services: –manufactured goods: allocate direct labor and materials to cost of product allocate overhead based on actual usage of overhead expenses

9. 9 © Baan Development BV nAnalyze performance of cost centers nSet direct and accurate CP rates nImprove allocation of indirect costs nAnalyze profitability and product mix nProduce Management Income Statements nBreak Costs into Fixed and Variable Components nTranslate Business Plans into Flexible Budgets Cost Accounting Why?

10. 10 © Baan Development BV The business process nCreate annual plans and budgets nPeriodically compare budget (what I expect to do) vs allowed costs (what would it cost at standard) vs actual (what actually happened and what it actually cost) nAfter results possible to readjust our standard to more appropriate amounts

11. 11 © Baan Development BV Manufacturing Plan Manufacturing Plan Capacity check Capacity check Production Plan Production Plan Sales Plan Sales by: Customer group Sales region Product group Disaggregation through Product Fam. to Products Hours Man Machine Material Concept - planning cycle

12. 12 © Baan Development BV Budget Production Plan Production Plan Operation rate/ surcharges Operation rate/ surcharges Cost price per item Cost price per item Fixed transfer price Fixed transfer price Stock valuation Stock valuation Actual Routing BOM Profit margins Profit margins Evaluation Fixed and Variable Concept - planning cycle

13. 13 © Baan Development BV Budget Production Plan Production Plan Operation rate/ surcharges Operation rate/ surcharges Cost price per item Cost price per item Fixed transfer price Fixed transfer price Stock valuation Stock valuation Actual Routing BOM Profit margins Profit margins Evaluation Fixed and Variable Concept - planning cycle Manufacturing Finance

14. 14 © Baan Development BV Budget types nMulti dimension budget –Budget amounts can be based on several cost types (one ledger account and/or one or more dimensions) together –Not performance driven –BAAN IV functionality nSingle dimension budget –Performance driven budgets that are only based on ONE dimension at the time –Usage of CAT module for allocation and iteration –Integrating surcharges/rates

15. 15 © Baan Development BV Ledger Account Dimension Dimension Types (1)(2)(3)(4)(5) Dimension A. B. E. D. C. Ledger Account Dimension Ledger Account Dimension Examples: Multi dimension budget nDefined in a horizontal way:

16. 16 © Baan Development BV Reference Unit (cost driver) Ledger Account Dimension Reference Unit (cost driver) Single dimension budget nDefined in a vertical way:

17. 17 © Baan Development BV FBS/CAT functionalities nCost Center Accounting (Budgeting) –Multi Dimension (=BaanIV functionality) –Cost Allocation (Single Dimension) nProduct Costing nActivity-based Costing Energy Accounting Dep. Production Dep. Warehouse Dep. Energy Production Dep. Warehouse Dep. Product A Product B Energy Production Dep. Warehouse Dep. Cutting Assembling Issuing Receiving Product A Product B

18. 18 © Baan Development BV nRehearsal Controlling 1 Questions 1-8 Skill Objectives

19. 19 © Baan Development BV Product Costing Single Dimension Budgeting Housekeeping Buildings/ Terrain Buildings/ Terrain Energy Assembly Warehouse Product A Product B

20. 20 © Baan Development BV Product Costing Single Dimension Budgeting Housekeeping Buildings/ Terrain Buildings/ Terrain Energy Assembly Warehouse Product A Product B Rates Machine 1 Machine 2 Surcharge Overhead surcharge

21. 21 © Baan Development BV Material = € 100 Overhead = € 50 Labor = € 46 € Total Cost = € 196 Cost Price Calculation

22. 22 © Baan Development BV BACK FRAME SEAT CHAIR FOAMFABRICFOAMFABRIC SIDEPART TUBE Qty: 1 € € 30.00 Qty: 1 € € 10.00 Qty: 1 € € 30.00 Qty: 1 € € 10.00 Qty: 2 Qty: 1 € € 5.00 Qty: 2 € € 5.00 Material costs

23. 23 © Baan Development BV BACK FRAME SEAT CHAIR Operations FOAMFABRICFOAMFABRIC SIDEPART TUBE 2 hr. € € 9.00/hr. 1 hr. € € 10.00/hr. 0.5 hr. € € 8.00/hr. 0.5 hr. € € 8.00/hr. 1 hr. € € 10.00/hr. Overhead: $10.00 / Man Hour Operation costs

24. 24 © Baan Development BV Operations structure Operation Task Work center Machine Operation Rate Cost Price Component Operation Rate Cost Price Component Cost Price Calculation Code Link to ledger accounts

25. 25 © Baan Development BV nRates and cost price components to be used in cost price calculation – Labor – Machine – Overhead nOverhead application method – Man hours – Machine hours nOperation rates linked to operation rate code nOperation rate code linked to work centers or tasks Operation rates

26. 26 © Baan Development BV nAdditional costs or discounts to be included in an item’s cost price nReporting tool to print subtotals on cost reports nDefined by calculation code – By item – By item group – By warehouse nFlexible application methods – Total costs – Selective cost price components Surcharges 1

27. 27 © Baan Development BV nSurcharge Types – Surcharge – Subtotal – Cumulative Cost Price nSurcharge Methods – Fixed Amount – % of Added Costs – % of Total Costs – % Selective (Total Costs) – % Selective (Added Costs) Surcharges 2

28. 28 © Baan Development BV nCosts associated with services provided by outside suppliers nRates are defined by calculation code, by supplier, by task nSubcontracting rates are associated to a subcontracting work center nSubcontracting item – Represents services purchased on subcontracting purchase order – Linked to a subcontracting rate Subcontracting rates 1

29. 29 © Baan Development BV nSubcontracting rate methods – Fixed Amount per Product—Rate is a fixed amount per unit of product – Operation Rate—Rate X subcontracting rate factor (in routing operation) – Man Hour Rate—Rate X estimated man hours – Machine Hour Rate—Rate X estimated machine hours Subcontracting rates 2

30. 30 © Baan Development BV nBill of Material set up Exercises 1-10 Skill Objectives

31. 31 © Baan Development BV Exercise product costing Laptop Black Laptop Black Operations: Assembling (2h) Operations: Assembling (2h) MEMCase Qty: 1 € € 600.00 Qty: 2 € € 60.00 Disk Qty: 4 € € 130.00 Operations: Painting (3h) Assembling (2h) Operations: Painting (3h) Assembling (2h) MEMCase Laptop Red Laptop Red Qty: 1 € € 600.00 Qty: 1 € € 60.00 Disk Qty: 2 € € 130.00

32. 32 © Baan Development BV nTop-Down nBottom-Up nSingle Level Cost Price Calculation method

33. 33 © Baan Development BV BACK FRAME SEAT CHAIR Operations FOAMFABRICFOAMFABRIC SIDEPART TUBE Cost Price Calculation method Selected Item: CHAIR

34. 34 © Baan Development BV BACK FRAME SEAT CHAIR Operations FOAMFABRICFOAMFABRIC SIDEPART TUBE Cost Price Calculation method Single Level Selected Item: CHAIR

35. 35 © Baan Development BV BACK FRAME SEAT CHAIR Operations FOAMFABRICFOAMFABRIC SIDEPART TUBE Cost Price Calculation method Top Down Selected Item: CHAIR

36. 36 © Baan Development BV BACK FRAME SEAT CHAIR Operations FOAMFABRICFOAMFABRIC SIDEPART TUBE Cost Price Calculation method Bottom Up Selected Item: FABRIC

37. 37 © Baan Development BV nUpdates the Item Costing Data nUpdates are date- and time-stamped nExecuted from three sessions – Calculate Cost and Valuation Prices – Actualize Cost and Valuation Prices – Item Costing Data Updating Standard costs

38. 38 © Baan Development BV Cost Price + Sales Price Surcharge @ Issue Sales Price Surcharge @ Issue = Sales Price Actual Sales Price Actual Sales Price Suggested Retail Price Suggested Retail Price Or Sales Price Calculation

39. 39 © Baan Development BV nStandard Item Costing Data nStandard Item Surcharges nStandard Cost Prices by Item nStandard Cost Price Details by Item nStandard Valuation Prices Cost Displays

40. 40 © Baan Development BV nPrint Standard Cost Prices by Item nPrint Standard Item Costing Data nPrint Cost Price Comparison by Item nPrint Cost Price Calculation by Item nPrint Standard Valuation Prices by Item nPrint Multi-Level Cost Price Calculation Cost Reports

41. 41 © Baan Development BV nCost Price Calculation Exercise 11 Skill Objectives

42. 42 © Baan Development BV Exercise product costing Cost price structure Direct material1240 Assembling rate costs (2hrs*100) 200 Warehouse surcharge (5% over dir.mat.) 62 1502 300 1799 Profit margin 20% Sales Price Direct material 920 Painting rate costs (3hrs*57) 171 Assembling rate costs (2hrs*100) 200 Warehouse surcharge (5% over dir.mat.) 46 1337 267 1599 Profit margin 20% Sales Price

43. 43 © Baan Development BV FBS versus CAT Product Costing CAT Allocation Relations Import Actual Retrogade Calculation Price Iteration Integration Set up GLDHRAFBS Logistic FBS Allocation Results Budget Distribution Budget Code Reference Units Hierarchies Report Structures LA Relations Budget Defaults Integration Set up Performance Budget Single Dim. Budget CPR Integrate Results HRA SurchargeRates Operation Results SurchargeRatesDeviation

44. 44 © Baan Development BV Budget Controlling cycle Comparison Reports Actual Operation Rates

45. 45 © Baan Development BV Set up master data nSet parameters –FBS + CAT (but also CPR, HRA) nDefine distributions, reference units, cost types, hierarchies, dimension types/codes nDefine integration schemes –Logistic into Finance –into HRA & CPR

46. 46 © Baan Development BV Budget defaults nBudget currency nBase rate nVariability –variable part of the costs nParent budget nApplicable ledger accounts per dimension nSource-target relation between ledger accounts –dependencies by dimension type

47. 47 © Baan Development BV Ledger Account Structure nPrimary and secondary ledger accounts linked to dimensions nUsed to copy into single dimension budget Dimension Type : Dimension Code : Business Unit/Cost Center Warehouse LA2010 Wages LA0560 Depreciation LA4050 Interest Costs LA5500 Allocate to cost object

48. 48 © Baan Development BV Reference units nReference unit = cost driver, surcharge base nAmount based and quantity based nRetrograde versus progressive planning nEquivalence factor –percentage assigned in case of more reference units nBudget and effective rates/surcharges nRates can be integrated to Logistics as rate (machine/man hour tariff) or as surcharge nCan have link to logistic quantities and ledger account quantities

49. 49 © Baan Development BV nBudget defaults nLedger Account Structure nReference Units nPerformance Budget nSingle Dimension Budget nAllocation Relations nRates and Surcharges Exercises 12-26 Skill Objectives

50. 50 © Baan Development BV Exercise product costing Rates / Surcharge Production department Production department Warehouse department Warehouse department Machine 1 Machine 1 Rate Laptop A Laptop B Item surcharge

51. 51 © Baan Development BV Integrate Rates / Surcharges nThe rates and surcharges calculated in FBS can be integrated with CPR, and used for updating the cost price of an item Cost CenterReference Unit Financial Budget System Cost Price Calculation Operation Rate AssemblyMachine 1 AssemblyMachine 2 318Rate for machine 1 314Rate for machine 2 Cost CenterReference Unit WarehouseDirect Material WarehouseDirect Material SurchargeTrigger Item AReceipt Item BReceipt

52. 52 © Baan Development BV Actual Cost Price Code Used? Calculate Cost and Valuation Prices ((tcmcticpr2210m000) Actualize Cost and Valuation Prices (ticpr2220m000) Print Standard Cost Price Details by Item (ticpr3405m000) Integrate Budget Operation Rates (tffbs1230m000) Integrate Budget Surcharges (tffbs1231m000) Process integrate rates / surcharges Yes No Optional

53. 53 © Baan Development BV nIntegration set up Rates/Surcharges nUpdate cost price Exercises 27-28 Skill Objectives

54. 54 © Baan Development BV Controlling cycle Budget Comparison Reports Actual

55. 55 © Baan Development BV Processing actual data nEnter actual data –actual amounts from GLD –actual quantities from GLD and Logistics –actual performances –actual hours from HRA nCalculate allowed costs (through price iteration) –total fixed costs + proportional part of variable costs nCalculate actual rates and surcharges

56. 56 © Baan Development BV Integrate Actual Production nIntegration Mapping Scheme –Efficiency Variance –Price Variance –Add.Calc.Office Variance

57. 57 © Baan Development BV Manufacturing HRA Manufacturing HRA General Ledger General Ledger Cost Accounting Cost Accounting Via Integration actual hours * operation rate Via integration actual hours Posting quantities Via integration quantities Manual quantities Actual quantities

58. 58 © Baan Development BV Import Actual Costs nDistribution method for calculating the reference unit amounts

59. 59 © Baan Development BV Import Actual Performances nImported from

60. 60 © Baan Development BV Integrate Actual Hours nCAT integration relations with HRA Cost CenterReference Unit Cost Accounting Hours Accounting Kind of Integration AssemblyMachine 1 AssemblyMachine 2 Machine HoursM1 Machine HoursM2

61. 61 © Baan Development BV Finance Cost Accounting expenses accruels costs of business accounting Overhead Cost Allocation Sheet Cost Types Service Centers Main Cost Center MCC1 MCC2 MCC3 MCC4 primary costs allocation from allocation to Order invoice ORD 1 ORD 2 ORD 3 Revenues COGS Statement of operating results turnover direct costs other order costs fixed costs a. deviations x x x x x x Overhead Costs CU 1 CU 2 CU 3 Sales Actual amounts

62. 62 © Baan Development BV nIntegration Mapping Scheme nImport Actual amounts nImports Actual performances nIntegrate Rates/Surcharges Exercises 29-38 Skill Objectives

63. 63 © Baan Development BV Comparison Controlling cycle Budget Reports Actual

64. 64 © Baan Development BV nEfficiency Deviation –Compare of planned consumption vs actual (at management/cost center level) nOccupation Deviation –Planned fixed costs vs actually charged portion of fixed costs nOver/Undercoverage Deviation –Only occurs if effective rates/surcharges differs from calculated values ((Effective rate - Calc. value) x actual performance) nConsumption Deviation –(Actual costs - allowed costs) Deviation analysis

65. 65 © Baan Development BV Deviation analysis Occupation nOccupation deviation (absorption variance) –Planned fixed costs vs actually charged portion of fixed costs –Only applicable for full cost accounting systems –Calculation: quantity based: allowed costs - (budgeted performance quantity * total effective rate/surcharge) amount based: allowed costs - (surcharge base amount * effective surcharge) –Example: $100,000 - ($4,000 * $5) = $80,000

66. 66 © Baan Development BV Deviation analysis Over/Under coverage nOver/under coverage deviation (political variance) –Only occurs if effective rates/surcharges differ from calculated values –Decision made by higher management –Calculation: ((effective rate - calc. value) x actual performance) –Example: ($15 - $13) * $100,000 = $20,000

67. 67 © Baan Development BV Deviation analysis Consumption nConsumption deviation (efficiency variance) –comparison of planned consumption vs actual (at management/cost center level) –calculation: actual costs - allowed costs –example: $120,000 - $100,000 = $20,000

68. 68 © Baan Development BV Budgeted Costs Costs Budgeted Fixed Costs Political Price Performance (hours etc.) Budget Actual Costs Allowed Costs Comparison variance analysis Actual  Efficiency  Absorption  Political

69. 69 © Baan Development BV Actual costs= the actual costs ( in the general ledger ) Budgeted costs= budget performance X budgeted cost price per piece Allowed costs= total fixed budget + ( actual performance x variable budgeted cost price per piece ). Efficiency variance = Actual costs -/- Allowed costs Absorption variance = Allowed costs -/- ( Actual performance x total budgeted cost price per piece ) or = (actual performance -/- budgeted performance ) x fixed budgeted cost price per piece Political variance = (budgeted total cost price per piece -/- accepted cost price per piece) x actual performance Summary comparison

70. 70 © Baan Development BV Integrate Deviations nUsed for statement reporting Cost CenterCost Portion Source Dimension Destination Dimension AssemblyOccupation AssemblyConsumption Cost CenterDebit Account AssemblyOccupation Dev. AssemblyConsumption Dev Credit Account Deviation allocation

71. 71 © Baan Development BV nDeviations nIntegration of Operating results Exercise 39 Skill Objectives

72. 72 © Baan Development BV Reports Controlling cycle Budget Comparison Actual

73. 73 © Baan Development BV nDefined report structures can be used nHierarchies can be used independent from the default hierarchy of the report structure Cost Allocation Sheet

74. 74 © Baan Development BV Ledger accounts. Dim. code ActualBudget Allowed COST VARIANCES EfficiencyAbsorption Political Cost allocation sheet Example

75. 75 © Baan Development BV Gross Revenues - /- Discounts - /- Commissions _____________ = Net Revenues - /- Variable Costs _____________ = Contribution Margin I - /- Fixed Costs _____________ = Contribution Margin II Margin statements

76. 76 © Baan Development BV Statement of operating result Per cost center and/or cost object Turnover (-/-) Discounts/Commissions --------------------------------------------- Net Result (-/-) Direct Material Costs (-/-) Direct Variable Labor (-/-) Direct Variable Machine --------------------------------------------- Contribution Margin I (-/-) Direct Fixed Labor (-/-) Direct Fixed Machine (-/-) Material Surcharges Fixed (-/-) Production Surcharges Fixed --------------------------------------------- Contribution Margin II (-/-) Settlement of Remaining Costs --------------------------------------------- Contribution Margin III

77. 77 © Baan Development BV nCost Allocation Sheet nStatements Case 6.2 Skill Objectives

78. 78 © Baan Development BV Activity-based Costing Single Dimension Budgeting Indirect costs Direct wages Direct materials Activities Cost objects Resource cost driver (cost category) Activity cost driver (allocation relations) ABC nA method to allocate indirect costs nActivities are the center of interest (e.g. purchase)

79. 79 © Baan Development BV Activity Based Costing Single Dimension Budgeting Maintenance Product A Facilities Energy Production Warehouse Product B Material Handling Material Handling Packaging Painting Assembling

80. 80 © Baan Development BV : € 200.000.=Activity Item A Item BItem C Cost object 120.000 120.000100.000 Surcharge base Purchased items 1,00 0,500,20 Surcharge in € Purchase ABC in perspective Cost driver Purchase order lines 30.000 15.0005.000 Bill of Activities %. 60 % 30 %10 %

81. 81 © Baan Development BV Relations in ABC nCost objects consume activities nActivities require resources nCost objects, activities and/or resources are related to departments nActivities can be performed for all types of cost objects varying from products to sales areas or customers (groups) nMost often it is a combination of cost objects nActivity view and organization view can have a lot of overlaps –the process oriented organization –the cost center oriented organization

82. 82 © Baan Development BV FBS versus CAT Activity-based Costing CAT Allocation Relations Import Actual Retrogade Calculation Price Iteration Integration Set up GLDHRAFBS Logistic Generate BoA FBS Allocation Results Budget Distribution Budget Code Reference Units Hierarchies Report Structures LA Relations Budget Defaults Integration Set up CPR Performance Budget Single Dim. Budget Integrate Results HRA SurchargeRates Operation Results SurchargeRatesDeviation

83. 83 © Baan Development BV Reference unit Activities nReference Unit = Cost Driver or Surcharge Base Cost driver Purchase Orders Purchase Orders for a purchasing activity Deliveries Deliveries for an issuing activity Items Manufactured Items Manufactured for an assembling activity Cost driver Purchase Orders Purchase Orders for a purchasing activity Deliveries Deliveries for an issuing activity Items Manufactured Items Manufactured for an assembling activity

84. 84 © Baan Development BV L2800 Systems Department L2710 Wood Cutting L2710 Wood Cutting L2720 Sanding L2720 Sanding L2740 Assembly L2740 Assembly 600100 Rent Exp100% Facilities 610010 Electricity Exp100% 630100 Maintenance Exp100% 600100 Rent Exp100% Facilities 610010 Electricity Exp100% 630100 Maintenance Exp100% Source Dimension Cost Category Target Dimension 30% 40% Allocations through Cost Categories

85. 85 © Baan Development BV Building Depreciation Insurance Cost. Types (Ledger acc.) Assembly Production Department Warehouse Sales Allocated department - Item - Item group - Project Cost objects Overhead department Department Costs category I Costs category II * * * Costs- category III Cost category * Primary Cost Driver Activity Inspection Purchase- orders Sales-- orders Secondary Cost Driver * * * * Activity-based Costing

86. 86 © Baan Development BV ((Cost object/cost driver) * activity)/surcharge base Item, Item Group, or Project Item, Item Group, or Project Logistical Data which drives the cost Logistical Data which drives the cost Cost of the Activity Cost of the Activity Basis for Allocating Cost Basis for Allocating Cost ABC Calculation cost driver = reference unit

87. 87 © Baan Development BV Traditional calculation ABC example (1) Product (cost object) B RTotal Direct €0,3 per X27.000 3.000 30.000 Overhead €0,8 per X 72.000 8.000 80.000 Total €1,199.000 11.000110.000 Cost price 1,1 1,1 X= 90,000 for B and X=10,000 for R (X= number of products);

88. 88 © Baan Development BV Product (cost object) B RTotal Direct €0,3 per X 27,000 3,000 30,000 Setup 421Y37,89442,106 80,000 Total 64,89445,106110,000 Cost price 0.72 4.51 X= 90,000 for B and X=10,000 for R (X= number of products); Y= number of setups (activity driver); B: 90; R: 100; Driver rate: 80,000/190=421 ABC example (2) ABC calculation

89. 89 © Baan Development BV Cost prices TraditionalABC Product B 1,1 0,72 Product R 1,1 4,51 “How cost accounting distorts product costs” ! (Cooper & Kaplan, 1988) Traditional calculation does not take batch sizes into account ABC example (3)

90. 90 © Baan Development BV nActivities nBill of Activities nLogistic cost drivers Exercises 40-57 Skill Objectives

91. 91 © Baan Development BV nWhy first implement Controlling, and than Logistics ? Implementation Actual Hours of HRAImport in CAT Work Center Employee Machine Task Actual logistic performancesImport in CAT Sales Orders Sales Order Lines BOM Lines Routing Lines …..

92. 92 © Baan Development BV Activity Based Product Costing Single Dimension Budgeting Maintenance Product A Facilities Energy Production Warehouse Product B Material Handling Material Handling Packaging Painting Assembling

93. 93 © Baan Development BV Activity Based Product Costing Single Dimension Budgeting Maintenance Product A Facilities Energy Production Warehouse Product B Material Handling Material Handling Packaging Rate M1 Rate M2 Surcharge Handling Surcharge Packing Surcharge Handling Surcharge Packing