Survey of Accounting (Accounting I)
8th Edition
ISBN: 9781305961883
Author: Carl Warren
Publisher: Cengage Learning
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Question
Chapter 10, Problem 10.2MBA
To determine
(a)
Concept introduction:
Direct Cost:
The cost which is directly related to the product and affects those items directly, which contributes to the revenue generation in the business is referred as direct cost.
Indirect Cost:
The cost which is not directly related to the product and does not affect those items directly, which contributes to the revenue generation in the business is referred as indirect cost. These can be fixed cost or such costs are incurred as a whole and cannot be make relation to
The reason behind increment in the cost per plaque.
To determine
(b)
Concept introduction:
Direct Cost:
The cost which is directly related to the product and affects those items directly which contributes to the revenue generation in the business is referred as direct cost.
Indirect Cost:
The cost which is not directly related to the product and does not affect those items directly which contributes to the revenue generation in the business is referred as indirect cost. These can be fixed costs or such costs are incurred as a whole and cannot be make relation to manufacturing cost.
The area of concern for HT on the basis of unit costs.
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Raneri Trophies Inc. uses a job order cost system for determining the cost to manufacture award products (plaques and trophies). Among the company’s products is an engraved plaque that is awarded to participants who complete a training program at a local business. The company sells the plaques to the local business for $80 each. Each plaque has a brass plate engraved with the name of the participant. Engraving requires approximately 30 minutes per name. Improperly engraved names must be redone. The plate is screwed to a walnut backboard. This assembly takesapproximately 15 minutes per unit. Improper assembly must be redone using a new walnut backboard. During the first half of the year, Raneri had two separate plaque orders. The job cost sheets for the two separate jobs indicated the following information:
See Attachment
a. Why did the cost per plaque increase from $60 to $68?b. What improvements would you recommend for Raneri Trophies Inc.?
Raneri Trophies Inc. uses a job order cost system for determining the cost to manufacture award products (plaques and trophies). Among the company's products is an engraved plaque that is awarded to participants who complete a training program at a local business. The company sells the plaques to the local business for $80 each.
Each plaque has a brass plate engraved with the name of the participant. Engraving requires approximately 30 minutes per name. Improperly engraved names must be redone. The plate is screwed to a walnut backboard. This assembly takes approximately 15 minutes per unit. Improper assembly must be redone using a new walnut backboard.
During the first half of the year, Raneri had two separate plaque orders. The job cost sheets for the two separate jobs indicated the following information:
Why did the cost per plaque increase from $60 to $68?
What improvements would you recommend for Raneri Trophies Inc.?
Customer Profitability Analysis
HyStandard Services, Inc. provides residential painting services for three home building companies, Alpine, Blue Ridge, and Pineola, and it uses a job costing system for determining the
costs for completing each job. The job cost system does not capture any cost incurred by HyStandard for return touchups and refinishes after the homeowner occupies the home.
HyStandard paints each house on a square footage contract price, which includes painting as well as all refinishes and touchups required after the homes are occupied. Each year, the
company generates about one-third of its total revenues and gross profits from each of the three builders. The HyStandard owner has observed that the builders, however, require
substantially different levels of support following the completion of jobs. The following data have been gathered:
Cost per Driver Unit
$60
100
40
Support activity Driver
Major refinishes
Touchups
Hours on jobs
Number of visits
Communication Number…
Chapter 10 Solutions
Survey of Accounting (Accounting I)
Ch. 10 - Which 01 the following is not considered a cost of...Ch. 10 - Which of the following costs would be included as...Ch. 10 - A company estimated $420,000 of factory overhead...Ch. 10 - If the factory overhead account has a negative...Ch. 10 - When using job order costing for a professional...Ch. 10 - List three differences in how managerial...Ch. 10 - For a company that produces desktop computers,...Ch. 10 - How is product cost information used by managers?Ch. 10 - a.Name two principal types of cost accounting...Ch. 10 - What kind of firm would use a job order cost...
Ch. 10 - Prob. 6CDQCh. 10 - Prob. 7CDQCh. 10 - Describe the Source 01 the data for increasing...Ch. 10 - Prob. 9CDQCh. 10 - a.How is a predetermined factory overhead rate...Ch. 10 - a.What is (1) overapplied factory overhead and (2)...Ch. 10 - At the end of the fiscal year, there s a...Ch. 10 - What is the difference between a product cost and...Ch. 10 - Prob. 14CDQCh. 10 - Prob. 15CDQCh. 10 - How can activity based costing be used in service...Ch. 10 - Classifying costs as materials, labor, or factory...Ch. 10 - Classifying costs as materials, labor, or factory...Ch. 10 - Classifying costs as factory overhead Which of the...Ch. 10 - Classifying costs as product or period costs For...Ch. 10 - Prob. 10.5ECh. 10 - Transactions in a job order cost system Five...Ch. 10 - Cost flow relationships The following information...Ch. 10 - Cost of materials issuances An incomplete...Ch. 10 - Recording issuing of materials Materials issued...Ch. 10 - Amounts for materials Big Timber Furniture Company...Ch. 10 - Prob. 10.11ECh. 10 - Recording factory labor costs The weekly time...Ch. 10 - Recording direct labor and factory overhead...Ch. 10 - Factory overhead rates and account balances...Ch. 10 - Predetermined factory overhead rate Novus Engine...Ch. 10 - Predetermined factory overhead rate Mt Ellis...Ch. 10 - Recording jobs completed The following account...Ch. 10 - Determining manufacturing costs Wagner Printing...Ch. 10 - Financial statements of a manufacturing firm The...Ch. 10 - Job order cost accounting entries for a service...Ch. 10 - Prob. 10.21ECh. 10 - Prob. 10.22ECh. 10 - Just-in-time principles Jupiter Shirt Company...Ch. 10 - Activity-based costing for a hospital Deer Lodge...Ch. 10 - Activity-based costing in an insurance company...Ch. 10 - Classifying costs The following is a list of costs...Ch. 10 - Schedules for unfinished jobs and completed jobs...Ch. 10 - Schedules for unfinished jobs and completed jobs...Ch. 10 - Schedules for unfinished jobs and completed jobs...Ch. 10 - Schedules for unfinished jobs and completed jobs...Ch. 10 - Schedules for unfinished jobs and completed jobs...Ch. 10 - Schedules for unfinished jobs and completed jobs...Ch. 10 - Job cost sheet Hallmark Furniture Company...Ch. 10 - Job cost sheet Hallmark Furniture Company...Ch. 10 - Analyzing manufacturing cost accounts Summer...Ch. 10 - Analyzing manufacturing cost accounts Summer...Ch. 10 - Flow of costs and income statement R-Tunes Inc. is...Ch. 10 - Flow of costs and income statement R-Tunes Inc. is...Ch. 10 - Unit cost analysis The management of Colfax...Ch. 10 - Prob. 10.2MBACh. 10 - Prob. 10.3MBACh. 10 - Prob. 10.4MBACh. 10 - Prob. 10.1CCh. 10 - Prob. 10.2CCh. 10 - Prob. 10.3.1CCh. 10 - Classifying costs Reboot Inc. provides computer...Ch. 10 - Prob. 10.4.1CCh. 10 - Factory overhead rate Fabricator Inc., a...Ch. 10 - Factory overhead rate Fabricator Inc., a...Ch. 10 - Prob. 10.5CCh. 10 - Just-in-time principles Warm Space Inc....
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