Duty-Related Costs of Locating in an FTZ Aranda Company is an import-export company that relocated earlier this year in a foreign trade zone (FTZ) in a southwestern city. The company imports $760,000 of fabric from overseas for resale to clothing companies located in the United States. Aranda purchases and receives the fabric about four months before it is sold and shipped to customers; customers are billed and pay in two months. Duty is assessed at 15 percent of cost, and Aranda faces a 6 percent carrying cost. Required: 1. What is the amount of duty paid by Aranda last year (before locating in the FTZ) and for this year after relocating to the FTZ? Duty Last Year This Year 114,000 ✔ $114,000 ✔ 2. What is the amount of carrying cost associated with the duty paid by Aranda last year and for this year after relocating to the FTZ? Last Year This Year Carrying cost of duty 3,420 22,800 X 3. What is the total duty-related cost for Aranda last year and for this year after relocating to the FTZ? Last Year This Year Total duty-related cost $ 117,420 ✓ 4. What is the total savings on duty and carrving cost attributable to locating in an FTZ? Check My Work Previous Next

Duty-Related Costs of Locating in an FTZ Aranda Company is an import-export company that relocated earlier this year in a foreign trade zone (FTZ) in a southwestern city. The company imports $760,000 of fabric from overseas for resale to clothing companies located in the United States. Aranda purchases and receives the fabric about four months before it is sold and shipped to customers; customers are billed and pay in two months. Duty is assessed at 15 percent of cost, and Aranda faces a 6 percent carrying cost. Required: 1. What is the amount of duty paid by Aranda last year (before locating in the FTZ) and for this year after relocating to the FTZ? Duty Last Year This Year 114,000 ✔ $114,000 ✔ 2. What is the amount of carrying cost associated with the duty paid by Aranda last year and for this year after relocating to the FTZ? Last Year This Year Carrying cost of duty 3,420 22,800 X 3. What is the total duty-related cost for Aranda last year and for this year after relocating to the FTZ? Last Year This Year Total duty-related cost $ 117,420 ✓ 4. What is the total savings on duty and carrving cost attributable to locating in an FTZ? Check My Work Previous Next

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter17: Activity Resource Usage Model And Tactical Decision Making

Section: Chapter Questions

Problem 6E: Elliott, Inc., has four salaried clerks to process purchase orders. Each clerk is paid a salary of...

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Duty-Related Costs of Locating in an FTZ Aranda Company is an import-export company that relocated earlier this year in a foreign trade zone (PTZ) in a southwestern city. The company imports $760,000 of fabric from overseas for resale to dothing companies located in the United States. Aranda purchases and receives the fabric about four months before it is sold and shipped to customers; customers are billed and pay in two months. Duty is assessed at 15 percent of cost, and Aranda faces a 6 percent carrying cost Required: 1. What is the amount of duty paid by Aranda last year (before locating in the FTZ) and for this year after relocating to the FTZ? Last Year This Year Duty 2. What is the amount of carrying cost associated with the duty paid by Aranda last year and for this year after relocating to the FTZ? Last Year This Year Carrying cost of duty 3. What is the total duty-related cost for Aranda last year and for this year after relocating to the FTZ? Last Year This Year Total duty…
Aranda Company is an import-export company that relocated earlier this year in a foreign trade zone (FTZ) in a southwestern city. The company imports $760,000 of fabric from overseas for resale to clothing companies located in the United States. Aranda purchases and receives the fabric about four months before it is sold and shipped to customers; customers are billed and pay in two months. Duty is assessed at 15 percent of cost, and Aranda faces a 6 percent carrying cost. $1 = Y106.0 $1 = E0.84 Required: 1. What is the cost of the Y6,890,000 in dollars? 2. How many euros will Chinook receive from the German company in payment for the finished product? 3. What if the exchange rate of dollars for yen was $1 = Y108? What is the cost of the Y6,890,000 in dollars (rounded to the nearest dollar)?
Aranda Company is an import-export company that relocated earlier this year in a foreign trade zone (FTZ) in a southwestern city. The company imports $760,000 of fabric from overseas for resale to clothing companies located in the United States. Aranda purchases and receives the fabric about four months before it is sold and shipped to customers; customers are billed and pay in two months. Duty is assessed at 15 percent of cost, and Aranda faces a 6 percent carrying cost. Required: 1. What is the amount of duty paid by Aranda last year (before locating in the FTZ) and for this year after relocating to the FTZ? 2. What is the amount of carrying cost associated with the duty paid by Aranda last year and for this year after relocating to the FTZ? 3. What is the total duty-related cost for Aranda last year and for this year after relocating to the FTZ? 4. What is the total savings on duty and carrying cost attributable to locating in an FTZ? 5. What if some of the fabric turned out to be…
In December, the Win Publishing Company ships 20 sets of books to a book dealer on consignment. The consignor maintains a cost accounting system and perpetual inventories; the cost of manufacturing each set is P3,000. At the end of December, the dealer reports the sale of 8 sets at P5,000 each and remits sales proceeds less 15% representing commissions and all expenses paid by the consignee. Freight paid by the consignee on the receipt of the sets is 1,500. Delivery and installation expense for the units sold was P1,200. The consignee returned 1 defective set of books to the consignor and paid freight of P1,000. How much is the cash remittance? how much is the net income related with the consignment sales?
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Adams Air is a large airline company that pays a customer relations representative $16,425 per month. The representative, who processed 1,100 customer complaints in January and 1,360 complaints in February, is expected to process 21,900 customer complaints during the year. Required Determine the total cost of processing customer complaints in January and in February.
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Munoz Air is a large airline company that pays a customer relations representative $3,900 per month. The representative, who processed 1,180 customer complaints in January and 1,370 complaints in February, is expected to process 23,400 customer complaints during the year.Required Determine the total cost of processing customer complaints in January and in February.
Aziz Company sells two types of products, basic and deluxe. The company provides technical support for users of its products at an expected cost of $270,000 per year. The company expects to process 10,000 customer service calls per year. Required: 1. Determine the company's cost of technical support per customer service call. 2. During the month of January, Aziz received 570 calls for customer service on its deluxe model and 270 calls for customer service on its basic model. Assign technical support costs to each model using activity-based costing (ABC). Assign technical support costs to each model Model Activity Rate Deluxe Basic Cost driver quantity incurred Allocated Cost