|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|
In: Accounting
Cost behavior. VW has determined the following cost information at a volume of 16,000 units: Total variable expenses = $108,000 and average cost = $13.00. Assuming 40,000 units is within the relevant, compute TOTAL cost at a volume of 40,000 units.
In: Accounting
| ('$) | ('$) | ||||||
| Unit. | Total | Balance | |||||
| Date | Explanation | Units. | Cost | Cost | in Units | ||
| Jun-01 | Beginning inventory. | 50 | 1.0 | 50 | 50 | ||
| Jun-06 | Purchase | 50 | 1.2 | 60 | 100 | ||
| Jun-10 | Sales | 60 | 40 | ||||
| Jun-13 | Purchase | 150 | 1.4 | 210 | 190 | ||
| Jun-20 | Purchase | 100 | 1.6 | 160 | 290 | ||
| Jun-25 | Purchase | 150 | 1.8 | 270 | 440 | ||
| Jun-30 | Sales | 200 | 240 | ||||
FIFO Periodic System
COGS:
Ending Inventory:
Average Cost Periodic System
COGS:
Ending Inventory:
FIFO Previous System
COGS:
Ending Inventory:
Average Cost Previous System
COGS:
Ending Inventory:
Show Solutions
In: Accounting
Following information is available for the company.
|
Date |
Explanation |
Units |
Unit cost |
Total Cost |
|
1st of March 2012 |
Beginning inventory |
15,00 |
SR 7 |
SR 10500 |
|
5th March |
Purchases |
3,000 |
SR 8 |
24,000 |
|
13th March |
Purchases |
5,500 |
SR 9 |
49,500 |
|
21st march |
Purchases |
4,000 |
SR10 |
40,000 |
|
March 26 |
Purchases |
2,000 |
SR 11 |
22,000 |
|
Total |
16,000 |
135,500 |
Requirement: Total units the company sold are 1200. Find the Costs of goods sold for the company through FIFO, LIFO and Average method.
In: Accounting
4. The chief cost accountant for Kenner Beverage Co. estimated that total factory overhead cost for the Blending Department for the coming fiscal year beginning May 1 would be $130,000 and total direct labor costs would be $100,000. During May, the actual direct labor cost totaled $12,000 and factory overhead cost incurred totaled $15,950.
Required:
| A. | What is the predetermined factory overhead rate based on direct labor cost? |
| B. | On May 31, journalize the entry to apply factory overhead to production. Refer to the Chart of Accounts for exact wording of account titles. |
| C. | What is the May 31 balance of the account Factory Overhead-Blending Department? |
| D. | Does the balance in part C represent over- or underapplied factory overhead? |
| CHART OF ACCOUNTS | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Kenner Beverage Co. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
| General Ledger | ||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||
In: Accounting
In: Economics
A3-10. Imagine a firm with the short run cost structure: Total Cost (TC) = 9 + q 2 Marginal Cost (MC) = 2q.
(a) Write out expressions for total fixed cost (FC), total variable cost (VC), average variable cost (AVC), and average total cost (ATC). Be sure to show your work.
(b) At what quantity is AVC at its minimum (at what AVC level)? At what quantity is ATC at its minimum (at what ATC level)?
(c) Given your results above, sketch MC and AVC from q = 0 to q = 9. Calculate ATC for q = 1, 3, 6, and 9. Use this information to add ATC to your diagram (from q = 1 to q = 9).
(d) Assuming that the firm is a price-taker operating in a competitive market, derive an expression for the firm’s supply curve, (ie. the profit maximizing output for the firm as a function of the market price). What is the shut-down price for this firm (ie. at what price would this firm choose to produce zero)?
(e) Suppose the competitive market is composed of firms (and potential firms) identical to the one described above. Is it possible that a market price of $8 is a short run equilibrium price? Is it possible that a market price of $4 is a short run equilibrium price? Explain.
(f) Assuming that the minimum point of the short run ATC curve for all firms is also the minimum point of the long run average cost curve (LRAC) is it possible that either of the prices identified in part (e) is a long run equilibrium price? Explain.
(g) Under the assumptions of parts (e) and (f), what is the long run equilibrium price in this market? If, at that price, the quantity demanded in the market is 882 units, what is long run equilibrium number of firms in this market?
In: Economics
12 - What is target cost per unit?
A.Target cost per unit is the average total unit cost over the
product's life cycle.
B.Target cost per unit is the average total unit cost over the
contribution margin ratio.
C.Target cost per unit is the contribution margin per unit over the
average total unit cost.
D.Target cost per unit is the variable unit cost over the
product's life cycle.
13 - What is value engineering?
A.Charging different prices to different customers for the same
product or service.
B. A cost-reduction technique, used primarily during the design
function in the value chain, that uses information about all value
chain functions to satisfy customer needs while reducing
costs.
C.Continuous improvement during manufacturing.
D.The effect of price changes on sales volume.
In: Accounting
Describe the relationship between average variable cost and average total cost. How are the general shapes of the AVC and ATC curves related?
In: Economics
Below is a table which shows a firm’s cost structure.
|
Output |
Labour |
Total cost ($) |
|
0 |
0 |
100 |
|
2 |
1 |
150 |
|
5 |
2 |
200 |
|
9 |
3 |
250 |
|
15 |
4 |
300 |
(a) Is the firm facing a short-run or long-run condition? Explain.
(b) Does the firm exhibit labour specialisation? Explain.
In: Economics