products. Chuck questioned if the current cost-management system was providing the management with accurate data about product costs. In a traditional‚ volume-based product-costing system‚ only a single predetermine overhead rate is used. All manufacturing-overhead costs are combined into one cost pool‚ a grouping of individual indirect cost items‚ and they are applied to products on the basis of a single variable that costs over a given time span (cost driver) that is closely related to production
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Classify each cost listed below as either a product cost or a period cost for purposes of preparing the financial statements for the bank. 1. The cost of the memory chips used in radar set. * Product Cost 2. Factory Heating Cost * Period Cost 3. Factory Equipment maintenance costs. * Period Cost 4. Training costs for new administrative employees * Period Costs 5. The cost of the solder that is used in assembling the radar sets. * Product costs 6. The Travel
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Produced | Proportion | Joint Cost Allocation | Unit Cost | 401 | 90‚000 | (90‚000/400‚000)0.225 or 22.5% | (200‚000 x 0.225)45‚000 | (45‚000/90‚000)0.5 | 402 | 120‚000 | (120‚000/400‚000)0.3 or 30% | (200‚000 x 0.3)60‚000 | (60‚000/120‚000)0.5 | 403 | 90‚000 | (90‚000/400‚000)0.225 or 22.5% | (200‚000 x 0.225)45‚000 | (45‚000/90‚000)0.5 | 404 | 60‚000 | (60‚000/400‚000)0.15 or 15% | (200‚000 x 0.15)30‚000 | (30‚000/60‚000)0.5 | 405 | 40‚000 | (40‚000/400‚000)0.1 or 10 % | (200‚000 x 0.1)20‚000
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PRINCIPLES OF COST CONTROL 1.1 Introduction Cost is important to all industry. Costs can be divided into two general classes; absolute costs and relative costs. Absolute cost measures the loss in value of assets. Relative cost involves a comparison between the chosen course of action and the course of action that was rejected. This cost of the alternative action - the action not taken - is often called the "opportunity cost". The accountant is primarily concerned with the absolute cost. However‚
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following data have been recorded for recently completed Job 501 on its job cost sheet. Direct materials cost was $3‚067. A total of 30 direct labor-hours and 104 machine-hours were worked on the job. The direct labor wage rate is $12 per labor-hour. The company applies manufacturing overhead on the basis of machinehours. The predetermined overhead rate is $11 per machine-hour. The total cost for the job on its job cost sheet would be: A. $4‚571 B. $3‚757 C. $3‚090 D. $3‚427 Applied manufacturing
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Soon after Teresa DeYoung’s husband died‚ her mother-in-law also died‚ leaving an inheritance of more than $400‚000 for DeYoung’s children. DeYoung hired John Ruggerio‚ an attorney‚ to ensure that her children would receive it. Ruggerio advised her to invest the funds in his real estate business. She declined. A few months later‚ $300‚000 of the inheritance was sent to Ruggerio. Without telling DeYoung‚ he deposited the $300‚000 in his account and began to use the funds in his real estate business
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Restructuring Blackberry Limited The need for change in organisations is at all time high‚ due to the rapid pace of information technology. Organisations are always at crossroads‚ knowing the must take swift action to survive the competitive society. Most organisation future depends‚ on the action applied‚ and one may have come across companies that the management actions lead to it destruction. These might be inefficiency‚ or lack of oversight from the management who ignored change indicator
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Q: Is depreciation expense or depreciation cost is fixed cost or variable cost in nature? Fixed costs: Fixed costs are such costs that do not change with the change in activity level within the relevant range. Where relevant range can be defined in terms of time or activity level. Variable costs: Variable costs are such costs that change with the change in activity level . Coming to the question‚ depreciation expense or depreciation cost can either be fixed or variable and this depends on the
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CASE IBM : Restructuring The Sales Force In 1993‚ IBM’s Board of Directors decided the time was right for dramatic action. The once proud company had seen its sales fall from almost $69 billion in 1990 to $64‚5 billion in 1992. In the same period‚ profits plunged from $5‚9 billion to a loss of $4‚96 billion. In April 1993‚ the Board hired Louis V. Gerstner‚ Jr. to serve as its new Chairman and Chief Executive Officer and to turn the company around. Just three months into the job‚ Gerstner announced
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Application Exercise Strategic Management Bharat Petroleum Corporation Limited (BPCL)‚ where I am employed‚ is engaged and exploration‚ refining‚ distribution and marketing of petroleum product across the country. In downstream product marketing BPCL‚ has bouquet of products on offer‚ ranging from Petrol‚ Diesel‚ to Aviation Fuel‚ to Cooking Gas to Auto Lubricants. It is a global major and ranked 225th in the Fortune Global 500 rankings of the world’s biggest corporations for the year 2012.
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