Lorenzo operates a brushless car wash. Incoming cars are put on an automatic, continuously moving conveyor belt. A car is washed as the conveyor belt carries it from the start station to the finish station. After the car moves off the conveyor belt, workers dry it and clean and vacuum the inside. Workers are managed by a single supervisor.

Lorenzo's accountant wants to estimate costs in December, when 11,150 cars are expected to be washed. She tried two different methods to estimate December costs, account analysis and high-low, with number of cars washed as the independent variable for both methods.

To estimate the cost function parameters using account analysis, she analyzed actual costs in June, when 10,600 cars were washed. Her analysis revealed the following total fixed costs and total variable costs for each cost item:

To estimate the cost function parameters using high-low, she used the following total cost and activity data from July and August:

REQUIRED [ROUND PER-UNIT COSTS TO TWO DECIMAL PLACES AND TOTAL COSTS TO THE NEAREST DOLLAR.]

Part A (6 tries; 5 points)
1. Using account analysis, what is the accountant's estimate of total fixed costs for December?  

2. Using account analysis, what is the accountant's estimate of variable costs per unit for December?  

Part B (6 tries; 5 points)
1. Using the high-low method, what is the accountant's estimate of total fixed costs for December?  

2. Using the high-low method, what is the accountant's estimate of total variable costs for December?  

Cost of Production Report: Weighted average method

The increases to Work in Process—Roasting Department for Highlands Coffee Company for May as well as information concerning production are as follows:

Work in process, May 1, 1,150 pounds, 40% completed$1,700

Coffee beans added during May, 10,900 pounds28,600

Conversion costs during May12,504

Work in process, May 31, 800 pounds, 80% completed_

Goods finished during May, 11,250 pounds_

Prepare a cost of production report for May, using the Weighted average method. Assume that direct materials are placed in process during production. If required, round cost per equivalent unit answers to the nearest cent.

Highlands Coffee Company

Cost of Production Report-Roasting Department

For the Month Ended May 31

Unit Information

Units charged to production:

Inventory in process, May 1

Received from materials storeroom

Total units accounted for by the Roasting Department

Units to be assigned costs:

Whole UnitsEquivalent Units of Production   

Transferred to finished goods in May --------------------- --------------------

Inventory in process, May 31 --------------------- -----------------

Total units to be assigned costs-------------------- ------------------

Cost Information

Cost per equivalent unit:

Costs

Total costs for May in Roasting Department$ -----

Total equivalent units ------

Cost per equivalent unit$ -------------

Costs assigned to production:

Inventory in process, May 1$ --------------

Costs incurred in May --------------

Total costs accounted for by the Roasting Department$ -----------------------

Costs allocated to completed and partially completed units:

Transferred to finished goods in May$------------------

Inventory in process, May 31 ------------------------

Total costs assigned by the Roasting Department$ --------------------

Cost of Goods Sold Budget

The controller of MingWare Ceramics Inc. wishes to prepare a cost of goods sold budget for September. The controller assembled the following information for constructing the cost of goods sold budget:

Use the preceding information to prepare a cost of goods sold budget for September. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

The increases to Work in Process—Roasting Department for Highlands Coffee Company for May as well as information concerning production are as follows:

Prepare a cost of production report for May, using the average cost method. If required, round cost per equivalent unit answers to the nearest cent.

The table below represents the output and cost structure for a firm. The market is perfectly​ competitive, and the market price is ​$10. Total costs include all implicit opportunity costs.

1. Calculate the firm’s profit at each rate of output and fill in the values in the table.
2. Calculate firm's marginal cost and marginal revenue at each rate of output and fill in the values in the table.
3. Calculate the firm’s average total costs and average variable costs at each rate of output and fill in the values in the table.
4. Based on the information in the table​ above, plot marginal cost​ (MC) at each rate of output. Properly label this line.
5. ​Based on the information in the table​ above, plot marginal revenue​ (MR) at each rate of output. Properly label each line.
6. Based on the information in the table​ above, plot average total costs ​ (ATC) and average variable costs at each rate of output. Properly label each line.
7. Highlight in yellow the short-run supply curve for this perfectly competitive firm.
8. Based on marginal​ analysis, what is the​ profit-maximizing rate of output for the firm?

1:

Marginal revenue product equals

2:

The long-run is a period of time

3:

Marginal cost equals

4:

The unique characteristic of a firm in perfectly competitive market equilibrium is

5:

The distinction between a firm and an industry does not exist in

6:

In a perfectly competitive market

Production and cost data for the Molding Department during June 2020 are presented below.

Prepare a schedule showing physical units of production.

.

Determine the equivalent units of production for materials and conversion costs.

.

Compute the unit costs of production.

.

Determine the costs to be assigned to the units transferred out and in process for June.

.

Prepare a production cost report for the Molding Department for the month of June.

Activity-Based Costing Hercules Industries manufactures two types of electrical power units, custom and standard, which involve four overhead activities—production setup, procurement, quality control, and materials management. An activity analysis of the overhead revealed the following estimated costs and activity bases for these activities: Activity Cost Activity Base Production setup $ 65,250 Number of setups Procurement 137,500 Number of purchase orders (PO) Quality control 175,000 Number of inspections Materials management 144,000 Number of components Total $521,750 The activity-base usage quantities for each product are as follows: Setups Purchase Orders Inspections Components Unit Volume Custom 200 1,100 2,200 450 1,000 Standard 250 150 300 350 1,000 Total 450 1,250 2,500 800 2,000 a. Determine an activity rate for each activity. Activity Rates Production Setup Procurement Quality Control Materials Management Activity cost $ $ $ $ Activity base Activity rate $ /setup $ /PO $ /inspection $ /component b. Assign activity costs to each product, and determine the unit activity cost using the activity rates from part (a). Round unit costs to the nearest cent. Custom Standard Setups Total $ $ Purchase Orders Total Inspections Total Components Total Total product cost $ $ Unit volume Unit cost $ $

Thakin Industries Inc. manufactures dorm furniture in separate processes. In each process, materials are entered at the beginning, and conversion costs are incurred uniformly. Production and cost data for the first process in making a product are as follows.

Prepare the production cost report for July 2020.

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Listed here are the total costs associated with the production of 1,000 drum sets manufactured by TrueBeat. The drum sets sell for $508 each.
  

Required:
1. Classify each cost and its amount as (a) either variable or fixed and (b) either product or period. (The first cost is completed as an example.)

2. Compute the manufacturing cost per drum set.