What is sunk cost and what are some real world examples of sunk cost and why is it important to understand sunk cost?
In: Finance
Your company makes widgets. The total cost of production consist of $1,500,000 in fixed cost + variable costs of $150 per widget produced. If your firm makes 10,000 widgets what will the total cost per widget produced?
In: Accounting
Contrast the differences between cost effectiveness and cost utility studies and give several examples of these.
In: Nursing
Describe the differences between cost-effectiveness analysis and cost-benefit analysis as they pertain to the issue of building a pipeline from Alberta to B.C for the purpose of exporting bitumen to Asian markets.
In: Economics
1. Explain in detail why it is important to distinguish product cost from period cost and the impact an error will have on the income statement and balance sheet if manufacturing overhead is incorrectly labeled as a period cost.
2. Explain what is meant by 'activity base' when dealing with variable cost. Provide at least one example of an activity base and how it affects the variable cost.
3. Explain the difference in cost breakdown between a traditional format income statement and a contribution format income statement? What benefit do you see in using one over the other? Which format is required by GAAP?
In: Accounting
Statement of Cost of Goods Manufactured for a Manufacturing Company
Cost data for Disksan Manufacturing Company for the month ended January 31 are as follows:
| Inventories | January 1 | January 31 | ||
| Materials | $196,500 | $170,960 | ||
| Work in process | 129,690 | 112,830 | ||
| Finished goods | 102,180 | 116,250 | ||
| Direct labor | $353,700 | |
| Materials purchased during January | 377,280 | |
| Factory overhead incurred during January: | ||
| Indirect labor | 37,730 | |
| Machinery depreciation | 22,790 | |
| Heat, light, and power | 7,860 | |
| Supplies | 6,290 | |
| Property taxes | 5,500 | |
| Miscellaneous costs | 10,220 | |
a. Prepare a cost of goods manufactured statement for January.
| Disksan Manufacturing Company | |||
| Statement of Cost of Goods Manufactured | |||
| For the Month Ended January 31 | |||
| Work in process inventory, January 1 | $ | ||
| Direct materials: | |||
| $ | |||
| $ | |||
| $ | |||
| Factory overhead: | |||
| $ | |||
| Total factory overhead | |||
| Total manufacturing costs incurred during January | |||
| Total manufacturing costs | $ | ||
| Cost of goods manufactured | $ | ||
b. Determine the cost of goods sold for
January.
$
In: Accounting
Discuss how it should be evaluated whether the cost driver hours is the best cost driver for estimating the cost function.
In: Accounting
How should we expect the cost of oil to affect the cost of producing gasoline, diesel and other oil-based products in the US and other parts of the world? Why?
In: Economics
Statement of Cost of Goods Manufactured for a Manufacturing Company
Cost data for Disksan Manufacturing Company for the month ended January 31 are as follows:
| Inventories | January 1 | January 31 | ||
| Materials | $167,750 | $147,620 | ||
| Work in process | 115,750 | 101,860 | ||
| Finished goods | 87,230 | 100,380 | ||
| Direct labor | $301,950 | |
| Materials purchased during January | 322,080 | |
| Factory overhead incurred during January: | ||
| Indirect labor | 32,210 | |
| Machinery depreciation | 19,460 | |
| Heat, light, and power | 6,710 | |
| Supplies | 5,370 | |
| Property taxes | 4,700 | |
| Miscellaneous costs | 8,720 | |
a. Prepare a cost of goods manufactured statement for January.
| Disksan Manufacturing Company | |||
| Statement of Cost of Goods Manufactured | |||
| For the Month Ended January 31 | |||
| $ | |||
| Direct materials: | |||
| $ | |||
| $ | |||
| $ | |||
| Factory overhead: | |||
| $ | |||
| Total factory overhead | |||
| Total manufacturing costs incurred during January | |||
| Total manufacturing costs | $ | ||
| Cost of goods manufactured | $ | ||
b. Determine the cost of goods sold for
January.
$
In: Accounting
A proposed cost-saving device has an installed cost of $640,000. It is in Class 8 (CCA rate = 20%) for CCA purposes. It will actually function for five years, at which time it will have no value. There are no working capital consequences from the investment, and the tax rate is 35%.
a. What must the pre-tax cost savings be for us to favour the investment? We require an 10% return. (Hint: This one is a variation on the problem of setting a bid price.) (Do not round your intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.)
Cost savings $
b. Suppose the device will be worth $92,000 in salvage (before taxes). How does this change your answer? (Do not round your intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.)
Cost savings $
In: Accounting