In addition to the unit indirect manufacturing costs, the following data are expectedfor the company's standard and deluxe models for 2025:Eason Company manufactures wheel rims. The company produces two wheel rimmodels: standard and deluxe. For 2025, Eason's managers have decided to usethe same indirect manufacturing costs per wheel rim that they computed in 2024using activity-based costing.E (Click the icon to view the expected information.)Because of limited machine hour capacity, Eason can produce either 2,000standard rims or 2,000 deluxe rims.(Click the icon to view the 2024 indirect manufacturing costs per wheel rim.)Read the requirements.Requirement 1. If Eason's managers rely on the ABC unit cost data computed in 2024, which model will they produce? Carry each cost to the nearest cent. (lgnoreselling and administrative expenses for this calculation.)ТextUsehodel.Data TableData TableDeluxSalStandardDeluxeIndirect Manufacturing Cost Per UnitDireSales price$800.00 $940.00StandardDeluxeDireDirect materials31.0048.00АВС сosts$224.40 $719.40IndiDirect labor45.0052.00$429.00 $Single-rate costs514.80GroPrintDonePrintDone

Calculation of gross profit: Standard Deluxe Sales Price $800 $940 Direct Materials ($31)…

Eason Company manufactures wheel rims. The company produces two wheel rim models: standard and deluxe. For 2025, Eason's managers have decided to use the same indirect manufacturing costs per wheel rim that they computed in 2024 using activity-based costing. E (Click the icon to view the 2024 indirect manufacturing costs per wheel rim.) In addition to the unit indirect manufacturing costs, the following data are expected for the company's standard and deluxe models for 2025: E (Click the icon to view the expected information.) Because of limited machine hour capacity, Eason can produce either 2,000 standard rims or 2,000 deluxe rims. Read the requirements. Requirement 1. If Eason's managers rely on the ABC unit cost data computed in 2024, which model will they produce? Carry each cost to the nearest cent. (Ignore selling and administrative expenses for this calculation.) Text Use hodel. Data Table Data Table þelux Sal Standard Deluxe Indirect Manufacturing Cost Per Unit Dire Sales price $ 800.00 $ 940.00 Standard Deluxe Dire Direct materials 31.00 48.00 ABC costs 2$ 224.40 $ 719.40 Indi Direct labor 45.00 52.00 Single-rate costs 2$ 429.00 $ 514.80 Gro Print Done Print Done

Eason Company manufactures wheel rims. The company produces two wheel rim models: standard and deluxe. For 2025, Eason's managers have decided to use the same indirect manufacturing costs per wheel rim that they computed in 2024 using activity-based costing. E (Click the icon to view the 2024 indirect manufacturing costs per wheel rim.) In addition to the unit indirect manufacturing costs, the following data are expected for the company's standard and deluxe models for 2025: E (Click the icon to view the expected information.) Because of limited machine hour capacity, Eason can produce either 2,000 standard rims or 2,000 deluxe rims. Read the requirements. Requirement 1. If Eason's managers rely on the ABC unit cost data computed in 2024, which model will they produce? Carry each cost to the nearest cent. (Ignore selling and administrative expenses for this calculation.) Text Use hodel. Data Table Data Table þelux Sal Standard Deluxe Indirect Manufacturing Cost Per Unit Dire Sales price $ 800.00 $ 940.00 Standard Deluxe Dire Direct materials 31.00 48.00 ABC costs 2$ 224.40 $ 719.40 Indi Direct labor 45.00 52.00 Single-rate costs 2$ 429.00 $ 514.80 Gro Print Done Print Done

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter2: Building Blocks Of Managerial Accounting

Section: Chapter Questions

Problem 9EA: The cost data for Evencoat Paint for the year 2019 is as follows: Using the high-low method, express...

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Make versus buy, activity-based costing. The Svenson Corporation manufactures cellular modems. It manufactures its own cellular modem circuit boards (CMCB), an important part of the cellular modem. It reports the following cost information about the costs of making CMCBs in 2017 and the expected costs in 2018:
Variable costing and absorption costing, the Z-Var Corporation. (R. Marple, adapted) It is the end of 2017. Z-Var Corporation began operations in January 2016. The company is so named because it has no variable costs (Zero VARiable). All its costs are xed; they do not vary with output. Z-Var Corp. is located on the bank of a river and has its own hydroelectric plant to supply power, light, and heat. The company manufactures a synthetic fertilizer from air and river water and sells its product at a price that is not expected to change. It has a small staff of employees, all paid xed annualsalaries. The output of the plant can be increased or decreased by pressing a few buttons on a keyboard. The following budgeted and actual data are for the operations of Z-Var. The company uses budgeted production as the denominator level and writes off any production-volume variance to cost of goods sold.
Taunton Company uses the high-low method to estimate its cost function. The information for 2017 is provided below: Machine-hours Labor Costs Highest observation of cost driver 3,000 $300,000 Lowest observation of cost driver 2,500 $277,500 What is the constant for the estimated cost equation?
Pharoah Company has decided to introduce a new product. The new product can be manufactured by either a capital-intensive method or a labor-intensive method. The manufacturing method will not affect the quality of the product. The estimated manufacturing costs by the two methods are as follows. Direct materials Direct labor Variable overhead Fixed manufacturing costs (a) Pharoah' market research department has recommended an introductory unit sales price of $28.00. The selling expenses are estimated to be $432,000 annually plus $2.00 for each unit sold, regardless of manufacturing method. Capital-Intensive $4.00 per unit $5.00 per unit $3.00 per unit $2,284,000 Calculate the estimated break-even point in annual unit sales of the new product if Pharoah Company uses the: 1. Capital-intensive manufacturing method. Labor-intensive manufacturing method. 2. Labor-Intensive $4.50 per unit $7.00 per unit $4.00 per unit $1,437,000 Break-even point in units Capital-Intensive Labor-Intensive
Variable costing and absorption costing, the Z-Var Corporation. (R. Marple, adapted) It is the end of 2017. Z-Var Corporation began operations in January 2016. The company is so named because it has no variable costs (Zero VARiable). All its costs are fixed; they do not vary with output. Z-Var Corp. is located on the bank of a river and has its own hydroelectric plant to supply power, light, and heat. The company manufactures a synthetic fertilizer from air and river water and sells its product at a price that is not expected to change. It has a small staff of employees, all paid fixed annual salaries. The output of the plant can be increased or decreased by pressing a few buttons on a keyboard. The following budgeted and actual data are for the operations of Z-Var. The company uses budgeted production as the denominator level and writes off any production-volume variance to cost of goods sold.
Variable costing and absorption costing, the Z-Var Corporation. (R. Marple, adapted) It is the end of 2017. Z-Var Corporation began operations in January 2016. The company is so named because it has no variable costs (Z ero VAR iable). All its costs are fixed; they do not vary with output. Z-Var Corp. is located on the bank of a river and has its own hydroelectric plant to supply power, light, and heat. The company manufactures a synthetic fertilizer from air and river water and sells its product at a price that is not expected to change. It has a small staff of employees, all paid fixed annual salaries. The output of the plant can be increased or decreased by pressing a few buttons on a keyboard. The following budgeted and actual data are for the operations of Z-Var. The company uses budgeted production as the denominator level and writes off any production-volume variance to cost of goods sold.
Speedy Motors assembles and sells motor vehicles and uses standard costing. Actual data and variable costing and absorption costing income statements relating to April and May 2020 are as follows: (Click the icon to view the data.) (Click the icon to view the variable costing income statements.) (Click the icon to view the absorption costing income statements.) The variable manufacturing costs per unit of Speedy Motors are as follows: (Click the icon to view the variable manufacturing costs per unit.) Read the requirements. Requirement 1. Prepare income statements for Speedy Motors in April and May 2020 under throughput costing. Begin by completing the top portion of the statement, then the bottom portion. (Complete all input fields. Enter a "0" for any zero amounts.) Revenues Direct material cost of goods sold Beginning inventory Direct materials Cost of goods available for sale Deduct ending inventory Total direct material cost of goods sold Manufacturing costs April 2020 6,900,000…
In comparing the traditional system with the activity-based costing system, which of Ergaster’s models had higher unit product costs under the traditional system? Based on this problem:Ergaster Corporation manufactures a variety of products. In the past, Ergaster has been using a traditional costing system in which the predetermined overhead rate was 150% of direct labor cost. Selling prices had been set by multiplying total product cost by 200%. Sensing that this system was distorting costs and selling prices, Ergaster has decided to switch to an activity based costing system for manufacturing overhead costs using three activity cost pools. Selling prices are still to be set at 200% of unit product cost under the new system. Information on these cost pools for next year is as follows: (see image) 11. Under the activity-based costing system, what would be the selling price of one unit of Model #36?
The cost data for Evencoat Paint for the year 2019 is as follows: Using the high-low method, express the companys maintenance costs as an equation where x represents the gallons of paint produced. Then estimate the fixed and variable costs. Predict the maintenance costs i190,000 gallons of paint are produced. Predict the maintenance costs if 81,000 gallons of paint are produced. Using Excel, create a scatter graph of the cost data and explain the relationship between gallons of paint produced and equipment maintenance expenses.
The management of Hartman Company is trying to determine the amount of each of two products to produce over the coming planning period. The following information concerns labor availability, labor utilization, and product profitability: a. Develop a linear programming model of the Hartman Company problem. Solve the model to determine the optimal production quantities of products 1 and 2. b. In computing the profit contribution per unit, management does not deduct labor costs because they are considered fixed for the upcoming planning period. However, suppose that overtime can be scheduled in some of the departments. Which departments would you recommend scheduling for overtime? How much would you be willing to pay per hour of overtime in each department? c. Suppose that 10, 6, and 8 hours of overtime may be scheduled in departments A, B, and C, respectively. The cost per hour of overtime is 18 in department A, 22.50 in department B, and 12 in department C. Formulate a linear programming model that can be used to determine the optimal production quantities if overtime is made available. What are the optimal production quantities, and what is the revised total contribution to profit? How much overtime do you recommend using in each department? What is the increase in the total contribution to profit if overtime is used?
Oat Treats manufactures various types of cereal bars featuring oats. Simmons Cereal Company has approached Oat Treats with a proposal to sell the company its top selling oat cereal bar at a price of $27,500 for 20,000 bars. The costs shown are associated with production of 20,000 oat bars currently. The manufacturing overhead consists of $3,000 of variable costs with the balance being allocated to fixed costs. Should Oat Treats make or buy the oat bars?
This cost data from Hickory Furniture is for the year 2017. Using the high-low method, express the factory utility expenses as an equation where x represents number of chairs produced. Predict the utility costs if 900 chairs are produced. Predict the utility costs if 750 chairs are produced. Using Excel, create a scatter graph of the cost data and explain the relationship between number of chairs processed and utility expenses.