The following information concerns several of the inventory items at DC’s:
| Description | Quantity | Unit Cost | Net Realizable Value | ||||||
| Department A: | |||||||||
| Model DC 225 | 74 | $ | 18.60 | $ | 17.50 | ||||
| Model DC 364 | 99 | 30.45 | 26.60 | ||||||
| Model DC 513 | 84 | 29.70 | 28.20 | ||||||
| Department B: | |||||||||
| Model AR 137 | 47 | 60.70 | 61.70 | ||||||
| Model AR 226 | 59 | 98.70 | 96.65 | ||||||
| Model AR 196 | 48 | 126.70 | 124.60 | ||||||
(Do not round your intermediate calculations. Round your answers to 2 decimal places.)
In: Accounting
| 10. The following figures are from the accounting records of the Red Fox Inn, the restaurant identified in Question 9: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Opening Inventory | $7,414.80 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Closing Inventory | $6,327.35 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Food Purchases | $17,642.80 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Transfers: Beverage to Food | $443.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Transfers Food to Beverage | $226.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Employees' Meals | $837.00 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| a. Calculate cost of food sold for the month of March. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Cost of Food Sold | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| b. Using the information provided in Question 9, calculate each of the following: | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Actual Cost % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Standard Cost % | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Potential Savings $ | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Potential Savings as a % of Sales
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In: Accounting
Value-Stream Costing Objective During the week of June 12, Harrison Manufacturing produced and shipped 16,400 units of its aluminum wheels: 3,600 units of Model A and 12,800 units of Model B. The following costs were incurred: Materials Salaries/ Wages Machining Other Total Cost Order processing $19,400 $19,400 Production planning 304,800 304,800 Purchasing 23,400 23,400 Stamping $380,000 38,000 $37,200 $19,200 474,400 Welding 160,000 20,000 16,000 12,000 208,000 Cladding 65,000 65,000 Testing 10,000 10,000 Packaging and shipping 10,000 10,000 Invoicing 14,200 14,200 Total $605,000 $439,800 $53,200 $31,200 $1,129,200 Required: Note: Round ALL interim calculations to two decimal places. Uses these values in subsequent computations.
1. Assume initially that the value-stream costs and total units shipped apply only to one model (a single-product value stream). Calculate the unit cost.
2. Calculate the unit cost for Models A and B. Unit Cost
Model A $
Model B $
3. What if Model A is responsible for 40 percent of the materials cost? Calculate the unit materials cost for Models A and B.
Unit Cost Model A $
Model B $
Calculate the total unit cost for Models A and B.
Unit Cost Model A $
Model B $
In: Accounting
On the basis of the following data, determine the value of the inventory at the lower of cost or market. Assemble the data in the form illustrated in Exhibit 10.
| Product |
Inventory |
Cost Per |
|
| Class 1: | |||
| Model A | 15 | $140 | $129 |
| Model B | 47 | 106 | 93 |
| Model C | 30 | 202 | 181 |
| Class 2: | |||
| Model D | 16 | 236 | 257 |
| Model E | 20 | 80 | 56 |
a. Determine the value of the inventory at the lower of cost or market applied to each item in the inventory.
| Inventory at the Lower of Cost or Market | ||||||
Product |
Inventory Quantity |
Cost per Unit |
Market Value per Unit (Net Realizable Value) |
Cost | Market | Lower of Cost or Market |
| Model A | $ | $ | $ | $ | $ | |
| Model B | ||||||
| Model C | ||||||
| Model D | ||||||
| Model E | ||||||
| Total | $ | $ | $ | |||
b. Determine the value of the inventory at the lower of cost or market applied to each class of inventory.
| Inventory at the Lower of Cost or Market |
||||||
Product |
Inventory Quantity |
Cost per Unit |
Market Value per Unit (Net Realizable Value) |
Cost | Market | Lower of Cost or Market |
| Class 1: | ||||||
| Model A | $ | $ | $ | $ | ||
| Model B | ||||||
| Model C | ||||||
| Subtotal | $ | $ | $ | |||
| Class 2: | ||||||
| Model D | $ | $ | ||||
| Model E | ||||||
| Subtotal | $ | $ | ||||
| Total | $ | $ | $ | |||
c. Determine the value of the inventory at the lower of cost or market applied to total inventory.
| Inventory at the Lower of Cost or Market | ||||||
Product |
Inventory Quantity |
Cost per Unit |
Market Value per Unit (Net Realizable Value) |
Cost | Market | Lower of Cost or Market |
| Model A | $ | $ | $ | $ | ||
| Model B | ||||||
| Model C | ||||||
| Model D | ||||||
| Model E | ||||||
| Total | $ | $ | $ | |||
In: Accounting
Lower-of-Cost-or-Market Inventory
On the basis of the following data, determine the value of the inventory at the lower of cost or market. Assemble the data in the form illustrated in Exhibit 10.
| Product |
Inventory |
Cost Per |
|
| Class 1: | |||
| Model A | 300 | $140 | $125 |
| Model B | 500 | 90 | 112 |
| Model C | 150 | 60 | 59 |
| Class 2: | |||
| Model D | 800 | 120 | 115 |
| Model E | 400 | 140 | 145 |
a. Determine the value of the inventory at the lower of cost or market applied to each item in the inventory.
| Inventory at the Lower of Cost or Market | ||||||
Product |
Inventory Quantity |
Cost per Unit |
Market Value per Unit (Net Realizable Value) |
Cost | Market | Lower of Cost or Market |
| Model A | $ | $ | $ | $ | $ | |
| Model B | ||||||
| Model C | ||||||
| Model D | ||||||
| Model E | ||||||
| Total | $ | $ | $ | |||
b. Determine the value of the inventory at the lower of cost or market applied to each class of inventory.
| Inventory at the Lower of Cost or Market |
||||||
Product |
Inventory Quantity |
Cost per Unit |
Market Value per Unit (Net Realizable Value) |
Cost | Market | Lower of Cost or Market |
| Class 1: | ||||||
| Model A | $ | $ | $ | $ | ||
| Model B | ||||||
| Model C | ||||||
| Subtotal | $ | $ | $ | |||
| Class 2: | ||||||
| Model D | $ | $ | ||||
| Model E | ||||||
| Subtotal | $ | $ | ||||
| Total | $ | $ | $ | |||
c. Determine the value of the inventory at the lower of cost or market applied to total inventory.
| Inventory at the Lower of Cost or Market | ||||||
Product |
Inventory Quantity |
Costper Unit | Market Value per Unit (Net Realizable Value) |
Cost | Market | Lower of Cost or Market |
| Model A | $ | $ | $ | $ | ||
| Model B | ||||||
| Model C | ||||||
| Model D | ||||||
| Model E | ||||||
| Total | $ | $ | $ | |||
In: Accounting
On the basis of the following data, determine the value of the inventory at the lower of cost or market. Assemble the data in the form illustrated in Exhibit 10.
| Product |
Inventory |
Cost Per |
|
| Class 1: | |||
| Model A | 34 | $66 | $82 |
| Model B | 8 | 45 | 24 |
| Model C | 41 | 44 | 59 |
| Class 2: | |||
| Model D | 27 | 235 | 259 |
| Model E | 39 | 281 | 293 |
a. Determine the value of the inventory at the lower of cost or market applied to each item in the inventory.
| Inventory at the Lower of Cost or Market | ||||||
Product |
Inventory Quantity |
Cost per Unit |
Market Value per Unit (Net Realizable Value) |
Cost | Market | Lower of Cost or Market |
| Model A | $ | $ | $ | $ | $ | |
| Model B | ||||||
| Model C | ||||||
| Model D | ||||||
| Model E | ||||||
| Total | $ | $ | $ | |||
b. Determine the value of the inventory at the lower of cost or market applied to each class of inventory.
| Inventory at the Lower of Cost or Market |
||||||
Product |
Inventory Quantity |
Cost per Unit |
Market Value per Unit (Net Realizable Value) |
Cost | Market | Lower of Cost or Market |
| Class 1: | ||||||
| Model A | $ | $ | $ | $ | ||
| Model B | ||||||
| Model C | ||||||
| Subtotal | $ | $ | $ | |||
| Class 2: | ||||||
| Model D | $ | $ | ||||
| Model E | ||||||
| Subtotal | $ | $ | ||||
| Total | $ | $ | $ | |||
c. Determine the value of the inventory at the lower of cost or market applied to total inventory.
| Inventory at the Lower of Cost or Market | ||||||
Product |
Inventory Quantity |
Cost per Unit |
Market Value per Unit (Net Realizable Value) |
Cost | Market | Lower of Cost or Market |
| Model A | $ | $ | $ | $ | ||
| Model B | ||||||
| Model C | ||||||
| Model D | ||||||
| Model E | ||||||
| Total | $ | $ | $ | |||
In: Accounting
Assume that you are considering purchasing an item that you currently manufacture. The manufacturing department of your firm has informed you that the average cost of the item produced inhouse is $66.00 per unit. You can produce as you need it, so no finished goods inventory is kept when you manufacture it yourself. Accounting has informed you that 9.1% of the fixed costs will not be saved if you stop producing the item. The item has associated with it seasonal quarterly demand as follows:
| Quater 1 | Quarter 2 | Quarter 3 | Quarter 4 | |
| Demand | 200 | 300 | 400 | 200 |
a. Calculate the total annual variable cost associated with manufacturing the item yourself in-house: Total Annual Variable Cost:_____________________________
After receiving the RFQs back from a list of suppliers, you decide to go with a supplier that will sell the item to you at a unit cost of $52. It has been calculated that the cost to place an order with this supplier is $25 per order. The holding cost is estimated to be 18% of unit cost per year with no need for safety stock since the seller you would work with is local and has the excess capacity needed to supply the items as you need them.
b. Using the Economic Order Quantity (EOQ) Model, evaluate the Total Annual Cost associated with outsourcing this item. Please fill out the table below (round to 2 decimal places):
| Quarter 1 | Quarter 2 | Quarter 3 | Quarter 4 | |
| Order Quantity (per order) | ||||
| COGS per Quarter | ||||
| Orderting Cost per Quarter | ||||
| Holding Cost per Quarter | ||||
| Quarterly Total Cost |
Overall Total Annual Cost:
c. Given the annual cost analysis above, should you continue to manufacture the item in-house or purchase it from this supplier? Support you conclusion with savings figures.
In: Operations Management
Sophie has a business where she sells DVDs for $15 each. The average variable cost of production is $10 per unit. The average total cost of production is $16. What should she do in the short run?
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In: Economics
Problem 16-2A Weighted average: Cost per equivalent unit; costs assigned to products LO C2, C3
[The following information applies to the questions
displayed below.]
Victory Company uses weighted-average process costing to account
for its production costs. Conversion cost is added evenly
throughout the process. Direct materials are added at the beginning
of the process. During November, the company transferred 740,000
units of product to finished goods. At the end of November, the
work in process inventory consists of 191,000 units that are 70%
complete with respect to conversion. Beginning inventory had
$544,635 of direct materials and $218,425 of conversion cost. The
direct material cost added in November is $3,644,865, and the
conversion cost added is $4,150,075. Beginning work in process
consisted of 70,000 units that were 100% complete with respect to
direct materials and 80% complete with respect to conversion. Of
the units completed, 70,000 were from beginning work in process and
670,000 units were started and completed during the period.
Problem 16-2A Part 3
3. Compute the direct material cost and the conversion cost assigned to units completed and transferred out and ending work in process inventory. (Round "Cost per EUP" to 2 decimal places.)
EUP Cost per EUP Total cost
Cost of units transferred out:
Direct materials
Conversion
Total costs transferred out
Cost of ending work in process
Direct materials
Conversion
Total cost of ending work in process
Total costs accounted for
In: Accounting
Question Identifying internal controls. Consider each situation separately. Identify the missing internal control procedure from these characteristics:
• Assignment of responsibilities
• Separation of duties
• Audits
• Electronic devices
• Other controls (specify)
a. While reviewing the records of Quality Pharmacy, you find that the same Team member orders merchandise and approves invoices for payment.
b. Business is slow at Amazing Amusement Park on Tuesday, Wednesday, and Thursday nights. To reduce expenses, the business decides not to use a ticket taker on those nights. The ticket seller (cashier) is told to keep the tickets as a record of the number sold.
c. The same trusted team member has served as a cashier for 12 years.
d. When business is brisk, Fast Mart deposits cash in the bank several times during the day. The manager at one store wants to reduce the time employees spend delivering cash to the bank, so he starts a new policy. Cash will build up over weekends, and the total will be deposited on Monday.
e. Grocery stores such as Convenience Market and Natural Foods purchase most merchandise from a few suppliers. At another grocery store, the manager decides to reduce paperwork. He eliminates the requirement that the receiving department prepare a receiving report listing the goods actually received from
the supplier.
In: Accounting