Selected Answer: direct materials Correct Answer: direct materials Question 5 1.5 out of 1.5 points A sunk cost is a cost Selected Answer: incurred in the past which is not relevant to present decisions. Correct Answer: incurred in the past which is not relevant to present decisions. Question 6 1.5 out of 1.5 points In a period when anticipated production is 10‚000 units‚ budgeted variable costs are $85‚000 and budgeted fixed costs are $45‚000. If 12‚000 units are actually produced
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manager of Jane-HW7 location is entitled to at least $1‚000 bonus. The total bonus amount = $1‚000 + ($5‚278 - $230) /10 x $1 = $1‚504.80 Budgeted Actual Cars washed 18‚400 12‚690 Price per car wash $10 $9.50 Variable cost $5 $4.75 Contribution margin $5 $4.75 Static budget variance = Actual results x Static budget amount (27 x 470 x $4.75) – ( 23 x 800 x $5) = $60‚277.50 - $92‚000 = $31‚ 722.50 U Flexible budget variance = Actual sales in units x (actual CM – Budgeted CM) 12‚690 x ($4
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charge 20% more for its water than it does now. 1. What is the maximum sales loss (in % and units) that Healthy Spring could tolerate before a 20% price increase would fail to make a contribution to profit? (That is‚ what is the basic breakeven sales change?) 2. By how much would Healthy Spring’s contribution increase if its sales declined by 15% following the price increase? HEALTHY SPRING WATER COMPANY PROBLEM 1b BREAKEVEN CALCULATIONS WITH A CHANGE IN VARIABLE COSTS It is usually
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DISCUSSION Our group discuss about case 11-55. Below are the solution: Question 1 Prepare a new contribution report for February‚ in which: * The static budget column in the contribution report is replaced with a flexible budget column. * The variances in the contribution report are recomputed as the difference between the flexible budget and actual columns. Answer Particulars | Static Budget | Flexible Budget | Actual | Variance | Unit (pounds) | 200000 | 225000 | 225000
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Competition Bikes Finical Analysis Dan Petersen WGU – JET2 Finical Analysis Task 4 A. 1. To: Vice President This report has been prepared to argue the case that the company’s current costing method should be changed to the activity based costing method. This report will review; the difference between traditional based costing and activity based costing; traditional split and allocations with activity based costing; and discusses the breakeven point for Competition bikes Inc. with
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Solutions Manual CHAPTER 19 RELEVANT COSTS FOR DECISION MAKING I. Questions 1. Quantitative factors are those which may more easily be reduced in terms of pesos such as projected costs of materials‚ labor and overhead. Qualitative factors are those whose measurement in pesos is difficult and imprecise; yet a qualitative factor may be easily given more weight than the measurable cost savings. It can be seen that the accountant’s role in making decisions deals with the quantitative factors. 2. Relevant
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$85.35 | | Total variable cost | $352.60 | 7. For each distribution strategy‚ calculate the unit contribution and contribution margin ratio for each of the two product lines (necklaces and earrings). What is the weighted average contribution margin for an order at a trade show and an order with a sales rep? For trade show distribution strategy‚ the unit contribution and contribution ratio for each of the product lines can be determined as below: | Necklace | Pair of earrings | Manufacturing
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made several changes in an effort to revitalize the store back to its full glory. The largest decision they made was to move the stores location‚ expanding it by 50% more space and selling staff. This move resulted in a five-year lease as well as extensive and expensive renovations. They also made some changes in product offerings and offered more sales potential at the cost of minor reductions in margins. During the year it took to complete the Hallstead’s renovation the industry started showing
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BA 117 Problem Set #1 - CVP Deadline: November 26‚ 2011 A. The break-even point in units can be computed as Fixed Costs divided by the contribution margin per unit. On the other hand‚ the break-even point in pesos can be computed as Fixed Costs divided by the contribution margin ratio. Using the profit equation π = TR – TC; where π = operating profit‚ TR = Total Revenue and TC = Total Cost‚ derive the break-even formulas. B. From the profit equation π = TR – TC‚ derive the formula for the
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Accounting II Final Exam Review Chapter 18 Direct and Indirect Costs -Cost – a payment of cash or a commitment to pay cash in the future for the purpose of generating revenues. A. Cost object – costs that are often classified by their relationship to a segment of operations. Ex. Product‚ sales territory‚ a department‚ or an activity‚ such as research and development 1. Direct Cost = identified with and can be traced to a cost object Ex. The wood for a guitar is a direct cost of the
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