Explain giving examples why it is important to keep current cost in line with planned cost. Using examples where possible, describe the process of job costing used in non-profit organizations.

Why is it important to establish appropriate cost pools?

An electrical component manufacturer has selected direct labour hours as an application base. They plan to sell 35,000 units of copper tubing although the factory has the capacity to produce 40,000 units under normal circumstances.

       Overheads are estimated as follows:

Indirect materials and supplies --------------------------- $96,200

Repairs and maintenance            -------------------------- $24,100

Plant service contracts                  ---------------------------$37,000

Refurbishing cost                          -------------------------- $89,100

Machinery depreciation               ------------------------ $185,000

Factory insurance                          ------------------------- $18,200

Property taxes                                 ---------------------------$4,500

Heat, light and power                   --------------------------$51,700

Miscellaneous factory overhead -------------------------- $6,000

indirect Labour                       -------------------------------$120,000

Materials                                 --------------------------------$80,000

Transportation                         ---------------------------------$25,000

Rent                                        ---------------------------------$40,000

Security Cost                          ---------------------------------$15,000

All overhead costs except depreciation, property taxes and miscellaneous factory overhead are expected to increase by 10% during the year. Depreciation should increase by 12% and a 20% increase in property taxes and miscellaneous overhead is expected. A total of 55,600 direct labour hours was actually used to produce 35,000 units of copper tubing . Direct labour hours is expected to increase to 60,000 hours as production volume increases.

Determine the Total estimated overheads?

Calculate the predetermined overhead rate

Calculate the overhead application rate if 60,000 Direct Labour hours was used in production . Ascertain the overhead applied to the job if it took 120 direct labor hours.

Factory Overhead Cost Variances

The following data relate to factory overhead cost for the production of 6,000 computers:

If productive capacity of 100% was 10,000 hours and the factory overhead cost budgeted at the level of 6,000 standard hours was $302,000, determine the variable factory overhead Controllable Variance, fixed factory overhead volume variance, and total factory overhead cost variance. The fixed factory overhead rate was $6.5 per hour. Enter a favorable variance as a negative number using a minus sign and an unfavorable variance as a positive number.

What would be cost (the different cost elements), speed, quality and flexibility from the perspective of a car manufacturer? Explain each individually

Use your knowledge of cost functions to calculate the missed cost data in the accompanying table.

Round your answers to two digits after the decimal.

What is the total cost when producing zero units?

total cost: $

What is the marginal cost for the first unit?

marginal cost: $

What is the average total cost when producing three units?

average total cost: $

What is the average variable cost when producing four units?

average variable cost: $

Is the cost of disposing hazardous waste materials resulting from factory operations a product cost or a period cost? Explain your statements/arguments.

Sitka Industries uses a cost system that carries direct materials inventory at a standard cost. The controller has established these standards for one ladder (unit):

Standard Quantity x Standard Price = Standard Cost Direct materials 3 pounds $4.50 per pound $13.50 Direct labor 2.00 hours $12.00 per hour    $24.00 Total cost $37.50 Sitka Industries made 3,000 ladders in July and used 8,800 pounds of material to make these units. Smith Industries bought 15,500 pounds of material in the current period. There was a $250 unfavorable direct materials price variance. A. How much in total did Sitka pay for the 15,500 pounds? B. What is the direct materials quantity variance? C. What is the total direct material cost variance? D. What if 9,500 pounds were used to make these ladders, what would be the direct materials quantity variance? E. If there was a $340 favorable direct materials price variance, how much did Sitka pay for the 15,500 pounds of material?

The controller for Vitrina Inc. has established the following activity cost pools and cost drivers.

                                        Budgeted               Budgeted

                                        Overhead               Level for

Activity Cost Pool Cost    Cost Driver            Cost Driver

Machine setups                 $200,000                Number of setups         160

Material handling               100,000                Weight of material   50,000 kilograms

Waste control                        50,000                Weight of chemicals          10,000 kilograms

Quality control                       75,000                Number of inspections 300

Other overhead costs        200,000                Machine hours        20,000

Each order must be a minimum of 1,000 boxes of film chemicals.

The production requirements for each minimum order are as follows:

Machine setups                 5 setups

Material handling               1,500 kilograms

Waste Control                   200 kilograms

Quality Control                  5 inspections

Other Overhead Costs      500 machine hours

Required:

1 Calculate the overhead that should be assigned to each minimum order of film chemicals using the above data.

2 Calculate the overhead that should be assigned to each minimum order of film chemicals if Vitrina decides to use a single predetermined overhead rate based on machine hours.

From the following? information, calculate the cost of ending inventory and cost of goods sold using the? (a) FIFO,? (b) LIFO, and? (c) weighted-average methods.

The ending inventory reveals eighteight items unsold

Irrelevant cost represent a business cost that does not impact a management decision. Since an irrelevant cost does not impact a managerial decision, in all likelihood the cost will not change that decision. In one decision a specified cost may be irrelevant to that decision, but with another managerial decision that cost may indeed be relevant, thus the term relevant cost, which is decision specific, (wiseGEEK, 2003-2019). Currently, Walmart has 1.4 million American workers, Walmart increased employee wages because it had to. The company was facing immense pressure from the media, their employees and outside organizations for wage increases. With churn costs 1.5 – 2.5 times the cost of the employee’s salary, Walmart needs to continually focus on employee retention. With the media running weekly stories about the poor working conditions at Walmart or the social services received by Walmart employees, the company needed a plan to stop the negative PR. Plus, as other retailers increase their wages and benefits, Walmart’s management is forced to do so as well, otherwise it would be left with a lack of applicants for its positions, (Gustafson, 2018). Walmart’s biggest expense is its labor costs. Instead of paying each employee a higher wage and then reducing their hours, Walmart ought to revamp its entire strategy to cut the number of workers it employs. Self-serve has been implemented in every industry because of its incredible savings power. Walmart needs to drastically reduce its workforce to save on its greatest expense. Employees will be happier because of the increased opportunities for full-time hours and Walmart shareholders will be satisfied with higher profit from lower total employee wages, (Gustafson, 2018).

What can be done differently?