$500‚000 $520‚000 Direct Labor Hours 300‚000 hrs. 290‚000 hrs. The factory uses a predetermined overhead rate per direct labor hour to apply factory overhead. During the year jobs which cost $1‚200‚000 were completed‚ and finished goods costing $1‚000‚000 were sold. No inventories were on hand at the beginning of the year. Determine the ending balance of Work-In-Process: a. $400‚000 b. $425‚000 c. $480‚000 d. $580‚000 2. At the beginning of 2013‚ Sparky Company had direct
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Description In ACC 301‚ you discussed the Dakota Office Products (DOP) case and were asked to design the ABC system. For this assignment in BCOM 250‚ you will take what you learned in ACC 301 and write a report recommending that DOP use activity-based costing to determine its pricing to customers. You do not need to go into deep detail about how you would design the ABC system. You will work with a team of 4-5 people to produce this deliverable. Assume that your group is part of the accounting staff at
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Activity Based Costing Accounting 2020 Professor Richard McDermot Traditional Costing Systems • Product Costs – Direct labor – Direct materials – Factory Overhead • Period Costs – Administrative expense – Sales expense Appear on the income statement when goods are sold‚ prior to that time they are stored on the balance sheet as inventory. Appear on the income statement in the period incurred. Traditional Costing Systems • Product Costs – Direct labor – Direct materials – Factory Overhead •
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1. If Wilkerson were to cut prices‚ based on contribution margin‚ to just cover short-term variable costs‚ what consequences could it experience? (5 marks) Several break-even-point assumptions are made in calculation: 1) Total fixed costs do not change with volume‚ and will exist regardless if the products are sold or not. 2) Sales mix will be constant. The contribution-margin percentage is 66.1%‚ which means 66.1 percent of each sales dollar is available for covering fixed costs and making
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Sippican Corporation According to the activity based costing‚ the manufacturing overhead should be apportioned in the following method The Direct Material cost per unit and the direct labour cost per unit for the valves‚ pumps and the flow controller is given below. Direct Material Direct Labour Total Units Cost/unit cost/unit Valves 7500 16 12.35 Pumps 12500 20 16.25 Flow Controller 4000 22 13 The total manufacturing overhead of $654600 should be apportioned based on the activity required for
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References: Latshaw‚ C. A.‚ & Cortese-Danile‚ T. M. (2002). Activity-Based Costing: Usage and Pitfalls. Review of Business‚ 23(1)‚ 30. Retrieved from EBSCOhost.
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reduce production cost they planned to shift the production from Geoffrey dolls to specialty dolls. The firm was based on the traditional cost system which allocated all the overheads on the basis of direct labor cost. For the Chicago plant this costing system was not appropriate. The new ABC system is recommended for the plant which showed that as the margin from specialty dolls is only 3%; it should be closed down. Using these new results it is recommended that more Geoffrey dolls be produced.
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Coffee Bean ST. GREGORY’S UNIVERSITY Coffee Bean‚ Inc. Managerial Accounting‚ BU2123‚ Research Project‚ Spring 2007 Coffee Bean‚ Inc. (CBI) is a processor and distributor of a variety of blends of coffee. The company buys coffee beans from around the world and roasts‚ blends and packages them for resale. CBI currently has 40 different coffees that it offers to gourmet shops in one-pound bags. The major cost of the coffee is the raw coffee beans. However‚ there is a substantial amount of manufacturing
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Course Title Financial & Management Accounting (MAIB) Course Code ACCO1116 Page 1 of 5 APPROVED - Resit Question 1 Decisions Ltd. is a multinational company that produces and sells spare parts for the automotive industry. The traditional costing system used by the company is based on the number of units for charging overheads to products. However‚ and the CEO thinks that this could lead to poor pricing decisions‚ considering the different level of complexity of the three main lines of production
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difference‚ management is considering phasing out the Royale model and increasing the production of the Majestic model. Before finalizing its decision‚ management asks the controller‚ Sally Fields‚ to prepare an analysis using activity-based costing. Sally accumulates the following information about overhead for the year ended December 31‚ 2012. | | | | | | |Cost | | | |
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